Instacart sues New York City over minimum pay, tipping laws

You can tell a lot about a company by what they’re willing to sue over. Take Instacart, which just filed a lawsuit against New York City. Its beef? The company doesn’t like five new city laws, set to take effect in January. They would require Instacart to pay workers more and give customers a tipping option of at least 10 percent.

Reuters reports that Instacart’s suit targets Local Law 124, which mandates that grocery delivery workers receive the same minimum pay as restaurant delivery workers. It also challenged Local Law 107, which mandates 10 percent or higher tipping options (or a place to enter one manually). The lawsuit also takes aim at other laws requiring extra recordkeeping and disclosures. The new rules are set to take effect on January 26.

As is typical of companies griping about regulations that hurt their bottom lines, Instacart framed the issue as a noble fight for what’s right. “When a law threatens to harm shoppers, consumers, and local grocers — and especially when it does so unlawfully — we have a responsibility to act,” the company proclaimed in a blog post. “This legal challenge is about standing up for fairness, for the independence that tens of thousands of New York grocery delivery workers rely on and for affordable access to groceries for the people who need it most.”

Instacart’s suit reportedly claims that Congress banned state and local governments from regulating prices on platforms such as its own. It also alleges that New York’s state legislature “has long taken charge” of minimum pay, and that the US Constitution doesn’t allow states and cities to discriminate against out-of-state companies.

The company warns that everyone will lose if it’s forced to comply. Should the laws take effect, “Instacart will be forced to restructure its platform, restrict shoppers’ access to work, disrupt relationships with consumers and retailers and suffer constitutional injuries with no adequate legal remedy,” it claimed in the filing.

Instacart CEO Chris Rogers, elevated to the post in May, has an estimated net worth of at least $28.6 million. His predecessor, Fidji Simo, who chairs the board and is now with OpenAI, is reportedly worth around $72.7 million. If NYC’s minimum pay laws will be as catastrophic as Instacart claims, maybe they could chip in to help.