California’s Governor passed Assembly Bill 286 (AB 286) which amends the Fair Food Delivery Act of 2020. AB 286 makes it unlawful for a food delivery platform to charge a customer any purchase price for food or beverage that exceeds the price posted by the food facility on the food delivery platform’s internet website at the time of the order. AB 286 also prohibits food delivery platforms from retaining any portion of amounts designated as a tip or gratuity.  Instead, the food delivery platform must pay the entire tip or gratuity to the person delivering the food or beverage, and any tip or gratuity for a pickup order directly to the food facility. Finally, AB 286 requires the platform to disclose to the customer and the food facility certain specified information related to fees, commissions, and costs charged to both parties.

AB 286 fits the National Restaurant Association’s Public Policy Principles for Third-Party Delivery, which is a set of guidelines enacted to ease tensions between restaurants and third-party delivery services.  One of the key guidelines is that “Restaurants deserve transparency on fees charged by third-party delivery companies.”

California is not the first to pass legislation to address transparency in delivery services.  New York City and Chicago have passed similar legislation, and the State of Nevada is not far behind. Several delivery companies have already adjusted national operations to get ahead of the legislation and eliminate existing tensions.

This bill takes effect on January 1, 2022.

Jackson Lewis will continue tracking state legislation that is relevant to employers. If you have questions about the effects of this or other recent legislation contact a Jackson Lewis attorney to discuss.

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Ellen E. Cohen

Ellen E. Cohen is a principal in the Los Angeles, California, office of Jackson Lewis P.C., providing comprehensive representation for management in employment disputes. She handles cases involving harassment, discrimination, retaliation, and wrongful termination in state and federal courts, as well as arbitration…

Ellen E. Cohen is a principal in the Los Angeles, California, office of Jackson Lewis P.C., providing comprehensive representation for management in employment disputes. She handles cases involving harassment, discrimination, retaliation, and wrongful termination in state and federal courts, as well as arbitration and administrative hearings.

Ellen takes a proactive approach in supporting her clients, providing valuable advice on a host of employment-related issues including employee discipline, termination, lay-off procedures, or accommodations under the ADA and FEHA. She knows how to offer strategic advice that is as practical as it is legally sound. Her adept handling of complex issues such as Family Medical Leave Act and state laws, wage and hour laws, and harassment and discrimination has made her an indispensable ally to her clients.

Perhaps most notable is Ellen’s commitment to understanding her clients’ businesses. She places great emphasis on working closely with clients, getting to know their unique operations, and building longstanding partnerships based on trust and mutual understanding. This approach allows her to devise tailored solutions that take into account not only legal risks but also business objectives.