The news: A New York City Council bill would make it illegal for Amazon, FedEx and other parcel operators to run last-mile deliveries through subcontractors in the five boroughs.
The Delivery Protection Act (Int 0518-2026) would require every last-mile facility to hold a city license, and to directly employ its warehouse and delivery workers. It has 34 co-sponsors in the 51-seat Council, enough to override a veto. Mayor Zohran Mamdani backs the bill.
The bill regulates who employs delivery workers, not what they are paid. Amazon delivers in New York through roughly 40 Delivery Service Partner firms employing more than 5,000 drivers, according to its own Council testimony.
FedEx Ground runs on independent service providers. UPS, which directly employs its drivers under a Teamsters contract, already runs the model the bill would require.
“They label us as third party contractors, but nothing could be further from the truth,” Amazon DSP driver Jerome Sloss said at a Teamsters rally outside City Hall, reports FreightWaves.
How it works: The bill, sponsored by Council Member Tiffany Cabán, reaches every warehouse that delivers to New York City consumers.
Each facility needs a Department of Consumer and Worker Protection license, with a $500 annual fee per location and a two-year license term.
Contracting out “core delivery services or core warehouse services” is prohibited. All core workers must be employees of the facility operator.
Violating the employment mandate costs $1,000 per day per violation. A facility that keeps non-employee drivers during the phase-in must post a $500,000 bond for each one.
Displaced subcontracted workers get first claim on the new direct jobs, 30 days’ notice before termination, and six hours of safety training a year.
The employment mandate takes effect 12 months after enactment, with extensions to 24 months for facilities with existing contracts.
Trucks over 26,001 pounds are exempt, meaning line-haul trucks are excluded but delivery vans are not. USPS is exempt as a government entity.
The competition: The bill would require Amazon and FedEx to employ drivers the way UPS already does.
About 80% of UPS’s US workforce is unionized under its 2023 Teamsters contract, including its package-car drivers, according to the company’s annual filing. Top driver pay under that contract reaches $49 an hour by 2027, while Amazon DSP drivers in the city average about $24 an hour, per Amazon.
Running deliveries through contractors costs the carriers less, and the bill would remove that option in the country’s densest parcel market.
“Amazon is trying to trick New Yorkers and the City Council with a multimillion-dollar astroturf misinformation campaign because it knows that the truth is on the Teamsters’ side,” Randy Korgan, who runs the union’s Amazon division, said at an August Teamsters rally.
UPS faces the least change of the three carriers. But it has its own dispute over subcontracted work: the Teamsters filed a national grievance in June over UPS shifting parcel work to its nonunion Roadie unit.
The pattern: New York would be the first US jurisdiction to ban a delivery business model outright. The three governments with last-mile rules on the books today put a price on delivery instead.
Colorado’s fee, now 31 cents per order, raised $93 million in fiscal 2024, per The Tax Adviser. Minnesota added a 50-cent fee on orders over $100 in July 2024. And Southern California’s air district makes warehouses over 100,000 square feet earn emission-reduction credits or pay into a mitigation fund under its Rule 2305.
More than 10 other states floated delivery fees in 2025, per tax-compliance firm Avalara. None has passed one.
New York is also moving while the same question sits unresolved at the federal level. The National Labor Relations Board is weighing whether Amazon’s control over its DSPs makes it their drivers’ employer, reports FreightWaves. The outlet reports the New York bill has become a national test of whether cities can decide that question themselves.
The counter: DSP owners covered by the bill say it would put them out of business.
“What the City Council is proposing is to make a draconian law that will force my legal entity to be shut down,” DSP owner Mark Facchin said at the hearing, per FreightWaves. Several hundred delivery workers turned out against the bill at a Council hearing that ran seven hours, per Reason.
A study by consultancy AKRF, commissioned by the industry coalition fighting the bill, projects that facilities would relocate outside city limits. That would put 10,000 jobs at risk and add $664 a year to household delivery costs.
Amazon has put about $5 million into that coalition, the Five Boroughs Jobs Campaign, according to state lobbying disclosures reported by amNewYork.
What's next: The bill has sat in the Council’s consumer and worker protection committee since its April 9 hearing, and no floor vote is scheduled. Supporters already have enough votes to pass it and override a veto; the timing depends on the committee.
If the bill becomes law, licensing starts 120 days after enactment, and the subcontracting ban follows 12 to 24 months later.
