By Christian Browne
Earlier this month, New York City Mayor Zohran Mamdani announced his support for the Delivery Protection Act (DPA), a bill pending in the city council that would require the operators of “last-mile” warehouses—facilities where packages are sorted before final delivery to customers—to obtain a license from the city’s Department of Consumer and Worker Protection. As a condition of receiving a city license, the law would prohibit operators from “contracting with any third parties, including staffing agencies or other subcontractors, for the performance of core delivery services or core warehouse services.” Operators would need to employ directly, on either a full or part-time basis, every delivery worker. For companies like Amazon, this would effectively ban the subcontracting model through which most packages are now delivered in New York City.
There is a problem, however. The city council has no general power to ban employment contracts or to dictate the labor arrangements between last-mile operators and their workers. Under the state’s Municipal Home Rule Law, the city council may enact laws relating to “the government, protection, order, conduct, safety, health and well-being of persons or property” within in the city. That authority includes a broad ability to regulate and license businesses, but the council cannot use its regulatory authority as an all-purpose vehicle to intrude into any and every aspect of private business operations.
The provisions of a licensing law like the DPA must have a “substantial relation” to the public goods set forth in state law, such as protecting public safety, health, and well-being. While the city council has the power to regulate an industry in ways that pertain to its overall safe and lawful operation, it cannot micromanage internal, private, and voluntary matters that have no discernible public impacts. A warehouse operator’s decisions on the terms of employment and whether to conduct business by contracting for services or by hiring in-house employees are private concerns that affect the operator and its workers, not the general public welfare.
The city council’s power is also limited by preemption—the supremacy of the state legislature over local lawmaking bodies. This doctrine prohibits municipalities from legislating in areas where the state legislature has enacted a comprehensive legal framework that applies uniformly statewide.
The New York State Labor Law governs employment matters throughout the state. Its provisions cover wages, hours, employer liability, worker safety, and unemployment insurance, along with many other aspects of employment and labor relations. In other words, state law has preempted the “field” of labor and employment.
Notably, under Labor Law Section 3, an employer may not employ, at any wage, a worker in a position that the Labor Law deems illegal. Under Section 3, the legislature expressly asserts its power to regulate the nature of employment and to bar employment “in certain work or under certain conditions.”
The Labor Law is plainly a comprehensive statutory scheme that governs nearly every facet of employment and contains a provision that allows the state to bar certain kinds of work and working conditions. Therefore, the city council may not ban a form of employment that is permitted under and governed by Labor Law.
While the DPA contains other provisions commonly found in licensing schemes, its actual purpose, as Mayor Mamdani readily concedes, is the elimination of independent contractors. According to the mayor, these contractors are part of a system that is “designed to shield” companies like Amazon “from responsibility” to their workers, whom, in his view, they exploit. “Through delivery subcontractors, corporations dictate hiring standards, delivery routes, steep productivity quotas and workplace expectations while denying that the workers making those deliveries are employees.”
The mayor may have legitimate concerns about working conditions in the last-mile delivery industry. But the city cannot use its lawful licensing power for an unlawful purpose. The city’s power to license businesses does not necessarily give it the power to dictate their basic employment structure. Before the city council passes this legislation, it should recognize the near certainty of a lawsuit—one in which the city is likely to be on the losing side.
Christian Browne is an attorney, former member of the Giuliani administration, and an adjunct fellow at the Manhattan Institute.
Sadly, Mamdani the politician will be better off if state law prevents him from doing what he says he seeks.
This way he gains on vibes without his voters facing the negative consequences of his position.
Isn’t this just an argument FOR plowing ahead, from his POV?
“I can posture all I want, then lose in court, so consumers won’t actually get hurt, and I can keep the Mamdani variety hour show going and my fans happy for months…”