Chicago Now Requiring Food Delivery Apps Disclose Fees To Customers

CHICAGO (CBS)-- Starting Friday, Chicagoans will be able to see previously hidden fees on their food delivery receipts from companies like Uber Eats and Doordash.

Customers will see a breakdown before they send any payment that will list how much the restaurant paid to the company that delivered your food and the original menu price of each dish and beverage.

The breakdown will also reveal the cost of delivery as well as any taxes.

CBS 2 reached out to some of the prominent food delivery companies for a response.

Postmates says they have always provided a breakdown of their fees. Uber-Eats says they will follow the new rule.

Grubhub and DoorDash didn't answer whether or not they plan on complying, but both companies have criticized the new rule.

David London, senior government relations lead for DoorDash, said the company already has provided a 50% reduction in commissions for more than 2,000 restaurants, along with waiving commissions for pickup orders, and charging no commissions for 30 days to restaurants that are new to the app.

"Unfortunately, this unnecessary and overreaching regulation, issued under the guise of the current emergency, will only lead to confusion and hurt restaurants and delivery workers. We will remain focused on serving the restaurants, customers, and Dashers who use our platform as we explore our options and hope to find future opportunities to partner with Chicago and its restaurant community," London said in a statement.

DoorDash said its commission fees cover the cost of insurance; credit card processing fees; advertising; maintaining the app and website; background checks for its drivers; customer support for its users, drivers, and client restaurants; and pay for its drivers, who earn an average of $22 an hour.

Grubhub said the new disclosure rules will only cause confusion for consumers.

"These efforts by policymakers risk discouraging people from enjoying restaurant meals safely at home and hurt our efforts to support restaurants," a Grubhub spokesperson wrote in an email.

Commission fees charged by food delivery apps like Grubhub and Uber Eats have come under increased scrutiny during the COVID-19 pandemic, as restaurants have had to rely more than ever on curbside pickup and delivery to stay in business.

Some restaurants have complained that delivery service fees can sometimes make their business unprofitable, but they have no choice but to use the services in order to keep customers. Some also have criticized promotional sales delivery services have offered to diners, supposedly to support businesses during the pandemic, while charging restaurants for the cost of the discounts.

"It's very important that there's transparency. I think the average customer who's ordering wants to know what the actual payment is, what the fee is going to be for the restaurant," Mayor Lori Lightfoot said when she announced the new rules earlier this month. "We just took a delivery at my house last night and there was very little transparency around where the different charges were going to fall and who was going to be bearing them."

The city says delivery services that don't provide a breakdown will face a daily fine of up to $10,000.

"Chicago's first-in-the-nation rules for 3rd party delivery companies will bring much-needed transparency for consumers while maintaining competition and innovation in the marketplace. We fully expect compliance with these common sense rules and we will consider enforcement measures for any companies that fail to comply.," Department of Business Affairs and Consumer Protection spokesman Isaac Reichman stated in an email.