Toronto is formally asking the regional government to put a temporary cap on the commission taken by food delivery companies to keep restaurants afloat amid the second wave of COVID-19.
The city council meeting on Wednesday unanimously approved the resolution.
“Throughout the epidemic we are appealing to food distribution companies to help their restaurant customers significantly so that they can stay in business,” Toronto Mayor John Tory said in a statement.
“Although some companies have come forward for help, we have heard from restaurants that more needs to be done right now, so we are arguing for this urgent action.”
Cites examples from other major cities in the United States, such as Los Angeles, where fees do not exceed 15 percent.
Some Toronto restaurants reported charging 30 percent commission through food delivery services and said they would make takeout services unsustainable when indoor dining is temporarily banned due to COVID-19.
With a 30 percent commission, restaurants are only $ 10.50 on the $ 15 order.
“I have heard from many restaurant owners that their margins are razor thin due to the high commission fees from food delivery service companies,” said Councilor Michael Ford. “During these difficult times, it’s a critical part of supporting our local” mum-and-pop “restaurants.”
Toronto is one of four areas that have been moved to the revised 2nd phase of Ontario’s economic restructuring plan due to an increase in COVID-19 cases.
Under this version of Stage 2, indoor dining is prohibited and facilities such as gyms and cinemas are closed. Restaurants can still offer a patio service as well as a takeout.
Premier had earlier appealed to food delivery companies to reduce their fees, but so far no official action has been taken.
On Wednesday, before Toronto approved its move, the New Democratic Party of Ontario said it would introduce a motion to reduce food delivery fees for restaurants in the province.
“Small restaurants are just hanging out. Take-and-t and delivery lights and their only options are to keep employees in the kitchen,” NDP leader Andrea Horwath said in a statement.
“Our move will force the government to take action now to protect these small businesses from the outrageously high fees being charged to small businesses at a time when these small businesses need relief.”
The City of Toronto has no municipal authority to regulate food delivery service companies or to have cap fees that they charge restaurants.