Instacart added a $5.99 'Regulatory Response Fee' to NYC orders after the passage of new worker protection laws requiring a $21.44-per-hour minimum wage for drivers.
New Yorkers relying on the convenience of grocery delivery were blindsided this week when Instacart suddenly slapped a new fee on orders, a move the company tied to a sweeping city law that went into effect Monday.
Customers will now pay an additional $5.99 fee at checkout labeled a "Regulatory Response Fee." According to the city’s website, app-based couriers delivering groceries through third-party platforms, such as Instacart, are now entitled to earn at least $21.44 per hour, the same rate that has applied to restaurant delivery workers, including Uber Eats and DoorDash, since April 2025. The worker protection measure will further raise the minimum rate to $22.13 per hour by April due to inflation. Previously, there was no legal minimum specifically for grocery delivery workers. INSTACART’S AI PRICING EXPERIMENT DRIVES UP COSTS FOR SOME SHOPPERS, STUDY SAYS "The regulatory response fee is the direct result of the City Council’s misguided and burdensome grocery delivery laws, which took effect this week," an Instacart spokesperson told FOX Business Wednesday. "For months, we raised clear, data-backed concerns that the policy would increase grocery delivery costs for New Yorkers, but those warnings were repeatedly ignored. At a time when household budgets are already under strain, the city moved forward with a policy that makes food less affordable and harder to access for the New Yorkers who rely on grocery delivery the most." INSTACART AGREES TO $60M CONSUMER REFUNDS AFTER FTC ACCUSES COMPANY OF HIDDEN FEES AND FORCED SUBSCRIPTIONS At checkout on the app, Instacart also noted that the new fee "helps cover increased operating costs in NYC due to government regulations on delivery platforms," according to social media posts online. In addition, the law requires delivery services to offer customers a tipping option before checkout, setting the default tip at 10% of an order’s cost. The city said the measures are intended to address practices that hid or delayed tip prompts, which the city estimated "cost workers over $550 million." While tipping has always been optional on the platform, Instacart reportedly emphasized at checkout that "tips are optional. NYC law guarantees delivery drivers a minimum hourly rate." PRICES ARE STEADYING AND WAGES ARE CLIMBING, NEW DOORDASH REPORT SHOWS Since 2024, Instacart issued several warnings while the measure was under consideration, claiming the new ordinance would cause grocery costs to "skyrocket" and limit access to delivery services. Former Mayor Eric Adams, who vetoed the measures last year while in office, also expressed concerns at a time when many New Yorkers — particularly seniors, SNAP or EBT recipients and individuals with disabilities — already face food insecurity. The city council ultimately overrode Adams' veto in September. New Yorkers were quick to blast the company’s new charge on social media this week. "Instacart charging/offsetting on the consumer a regulatory fee because laws were passed that YOU have to increase YOUR contractors pay is so lowbrow," one user wrote on X Monday. "As if the service fees you charge both patrons & merchants weren’t enough." GET FOX BUSINESS ON THE GO BY CLICKING HERE Other customers noted that they have already or plan to cancel their membership after the price increase. "Adding a fee in the middle of my contract … with the fees outlined should be illegal," one user said on Reddit Tuesday. FOX Business reached out to the city’s Department of Consumer and Worker Protection for more information.
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