Every so often, a piece of legislation comes along that may start as a local issue but has the potential to reshape the way our industry does business far beyond one city or state. New York City’s Intro 0518-2026 is one of those bills.
At first glance, Intro 518 can sound like another debate over independent contractors and worker classification. But that doesn’t really capture what is at stake.
As currently written, the bill would require workers performing certain warehouse and delivery functions to be directly employed by the operator of the last-mile facility. It would also significantly restrict the ability of those facilities to contract with third-party delivery companies to perform that work. Importantly, this can affect delivery companies even when their drivers are already W-2 employees.
That is a major distinction, and it is why CLDA is paying close attention.
Our industry is built around partnerships. Shippers, retailers, healthcare organizations, manufacturers and countless other businesses rely on professional delivery companies because those companies bring expertise, geographic reach, technology, specialized services and the ability to scale with their customers.
Intro 518 could disrupt those relationships by effectively determining which company is allowed to employ the workers performing the delivery work.
For a CLDA member that has spent years building a business, hiring and training employees, investing in technology and developing customer relationships, this is much more than a technical change in employment law. A compliant delivery company could potentially lose the ability to serve a customer simply because that customer operates a facility covered by the law.
And offering some of those employees jobs with another company does not preserve the business that employed them in the first place. It does not preserve its management team, customer relationships, company culture or every existing position.
The impact would be felt throughout New York
The New York Delivers Coalition has pointed to independent analysis estimating that Intro 518 could put more than 10,000 New York City jobs at risk, affect hundreds of locally owned delivery businesses and increase costs for consumers and small businesses.
There are operational concerns as well.
New York City’s delivery network is regional. If companies respond to the law by moving facilities or operations outside the five boroughs, the deliveries themselves don’t disappear. Those packages still need to reach homes, hospitals, offices, retailers and businesses throughout New York City.
They may simply have to travel farther to get there.
In Queens, which has the city’s largest concentration of identified large delivery facilities, operations could potentially shift to Long Island, New Jersey or elsewhere in the region. That could mean longer routes, more vehicle miles and additional congestion while also disrupting existing relationships between local delivery companies and their customers.
That is exactly the kind of unintended consequence policymakers should be considering before dramatically changing how an entire delivery network operates.
Why this matters outside New York
This is the part I think every CLDA member should be watching.
Intro 518 may be a New York City proposal today, but regulatory ideas do not stay inside municipal boundaries.
We have already seen how worker-classification policies can move from one jurisdiction to another. Intro 518 takes a different approach. Instead of focusing primarily on whether an individual worker qualifies as an employee or an independent contractor, it goes directly at the relationship between the customer, the facility and the delivery company.
During our recent Government Affairs Committee discussion, members compared the potential impact to California’s AB 5, but through a different mechanism. One focuses on classification standards. The other can restrict who is permitted to perform the work in the first place.
If that approach takes hold and begins to appear elsewhere, the implications for our industry could be substantial.
Imagine operating in several markets and having different rules in each city governing whether your customers are even allowed to contract with your company. Imagine a shipper being forced to bring a specialized delivery operation in-house even though an experienced local carrier already performs that work safely and responsibly.
That is why CLDA views this as more than a New York issue.
Worker protections and a strong delivery industry can coexist
CLDA supports meaningful standards for workplace safety, training, insurance, employee protections and responsible business practices.
But achieving those goals should not require dismantling legitimate partnerships between shippers and responsible delivery companies.
There are ways to address misclassification, unsafe practices, inadequate insurance, wage violations and other legitimate concerns without eliminating compliant businesses that employ people, serve their communities and provide essential delivery services. That is the conversation we believe policymakers should be having.
CLDA is taking action, and you can too
CLDA recently signed a letter supporting the New York Delivers Coalition’s efforts opposing Intro 0518-2026. Our Government Affairs Committee also voted to support the coalition effort and discussed giving individual CLDA member companies the opportunity to add their voices as well.
If your company does business in New York City, I strongly encourage you to take a few minutes to learn more and get involved. Even if you are not currently operating in New York, I encourage you to follow this issue because the precedent it creates could eventually affect delivery companies in markets across the country.
You can learn more about the New York Delivers Coalition and sign the petition opposing Intro 518 here:
https://www.nydeliverscoalition.org/take-action
CLDA will continue monitoring Intro 518, working with our industry partners and advocating for policies that protect workers while allowing responsible delivery companies to continue doing what they do best: keeping businesses, communities and the economy moving.
Michael Wright
CLDA Executive Director
