Provincial fee cap delivers on fairness
B.C. has become the first province in Canada, and one of a handful of jurisdictions in North America, to implement a permanent cap on fees charged by food-delivery companies.
The Food Delivery Service Fee Act has received Royal Assent and will now provide more cost certainty to restaurant and bar owners throughout the province, effective January 1.
“Shifting consumer habits throughout the pandemic led to B.C.’s restaurant industry continuously adapting to stay open and serve their customers,” Minister of Jobs, Economic Recovery and Innovation Ravi Kahlon said. “By passing legislation to make the delivery fee cap a permanent support for restaurants, we’re leading Canada in providing more stability and certainty to the sector itself, and to the delivery drivers who work within it.”
B.C.’s cap limits the fees for core services that delivery companies can charge restaurants to no more than 20 per cent of the dollar value of an order, echoing similar permanent caps enacted by Seattle and San Francisco. Restaurant and bar owners facing ongoing challenges from the pandemic and global inflation will no longer need to worry about delivery fees as high as 30 per cent returning when the temporary cap would have expired at the end of the year.
The move is being welcomed by local restaurateurs like the Pretium Group, which operates Wings Vernon, Italian Kitchen, 1516 Pub and Grill and Top Choice Pizza.
Wings Vernon / photo submitted“Moving to a fixed model is important for the industry and is a positive step for restaurants to be able to thrive in the future. Home delivery is an important component of industry revenues, as much as 25 per cent or more in some cases,” Pretium’s Katie Dahl told Vernon Matters. “Overall, the industry needs to keep prices affordable and avoid unfair delivery fees, especially after rising labour and food costs worldwide.”
The province indicates that between April 2020 and April 2021, takeout and delivery options for restaurants tripled from 12 per cent to 36 per cent of sales.
“In our view, by having a 20 per cent option it should keep everyone happy. And that’s very much the theme now we have seen at least a 25 per cent increase in delivery over the last few years,” Dahl added. “We do need to monitor this. We need the delivery companies to be happy as well or they will withdraw services.”
According to the BC Restaurant and Foodservices Association, B.C.’s restaurants were closed fewer days than any other jurisdiction in North America. The Food Delivery Service Fee Act joins other ongoing supports, including the ability of bars and tourism operators with liquor licences to purchase beer, wine and spirits permanently at wholesale prices and the authorization of thousands of Temporary Expanded Service Areas, helping businesses weather the pandemic and serve more patrons while complying with health orders.
The Food Delivery Service Fee Act also prohibits delivery companies from reducing driver compensation, ensuring employees and contractors continue to be paid their wages and gratuities.