A NYC Supermajority Wants to End the DSP Model. Here's What's Actually in the Bill.
The New York City Council has a co-sponsoring majority for legislation that would require last-mile delivery facilities in New York City to be licensed by the city and to directly employ their delivery workers — eliminating the subcontracting structure that defines the DSP model, according to FreightWaves and the National Employment Law Project. The Delivery Protection Act, authored by Council Member Tiffany Cabán, is co-sponsored by Council Speaker Julie Menin and a supermajority of Council members, according to Streetsblog NYC. Despite that support, the bill has not advanced to a floor vote because a prior Council speaker declined to schedule a hearing.
This is not a worker's rights side note for operators outside New York. The bill describes what a city-level policy response looks like when legislators decide the current DSP employment structure needs to change — and the legislative apparatus to pass it already exists.
What the Bill Actually Requires
The Delivery Protection Act has two operative mechanisms. First, it would require last-mile delivery facilities operating in New York City to obtain a license from the city's Department of Consumer and Worker Protection, per the NELP analysis and FreightWaves reporting. That license can be denied or revoked for a "pattern of practice of violations" of city, state, or federal law connected to workplace safety, road safety, environmental protection, or worker protections — a broad category with meaningful enforcement teeth.
The second mechanism is the structural change: licensed facilities would be prohibited from using third-party subcontractors to employ delivery workers. Drivers would have to be directly employed by the delivery company itself.
For Amazon's New York City operation, that means Amazon — not a DSP operator — would be responsible for hiring, compensating, and managing delivery drivers within the city's jurisdiction. The DSP model, in which Amazon contracts with independent operators who bear the employment relationship, would be prohibited within city limits.
Why Operators Outside New York Should Be Reading This
NYC established the legislative template on app-based delivery worker minimum earnings requirements — a model that was subsequently adopted by cities including Chicago and Seattle. The Delivery Protection Act follows the same pattern: a municipal policy response that, if enacted, provides a working legal framework other jurisdictions can adopt.
The federal trajectory is moving toward the same underlying conclusion through a different mechanism. On April 2, 2026, the NLRB issued a bargaining order requiring Amazon to negotiate with the Teamsters, ruling that Amazon illegally refused to recognize Teamsters representation at its JFK8 warehouse in Staten Island, according to the International Brotherhood of Teamsters. Separately, two NLRB regional offices have ruled that Amazon and its DSPs are joint employers of delivery workers, according to FreightWaves — a finding that, if upheld nationally, would make Amazon legally responsible for labor conditions it currently assigns to DSP operators.
Municipal and federal regulatory pressure are converging on the same question: who is the actual employer of last-mile delivery workers? The Delivery Protection Act would answer that question explicitly, by statute, for New York City.
The Business Model Risk
The DSP model creates value for operators by separating employment liability from delivery infrastructure. DSP operators hire, schedule, and manage drivers. Amazon provides route volume, vehicles through its Delivery Service Vehicle Program, and the end-customer relationship. The split allows Amazon to scale a last-mile delivery network without taking on the employment risk and overhead of a large hourly workforce.
Direct employment requirements would shift the driver employment relationship to Amazon. The operator's core operational function — workforce management — would transfer to Amazon's HR operation. What remains is fleet management and logistics execution, which exist, but carry different economics. An operator whose competitive value is built around workforce management faces a different business model than one whose value is built around fleet operations alone.
The turnover economics illustrate the scale of what's at stake. Bureau of Labor Statistics JOLTS data for NAICS 4921 — couriers and messengers — puts annual driver turnover in this sector at 80%. SHRM's 2024 benchmarking data puts replacement cost for non-CDL workers at $3,500–$5,500 per driver. For a 50-van operation, that's 40 drivers replaced per year at a cost of $140,000–$220,000 annually, before factoring in productivity loss from new drivers learning routes.
| Fleet size | Drivers replaced/yr | Annual turnover cost | |---|---|---| | 10 vans | 8 | $28K–$44K | | 50 vans | 40 | $140K–$220K | | 100 vans | 80 | $280K–$440K | | 300 vans | 240 | $840K–$1.32M |
Under direct employment requirements, that cost lands on Amazon's books, not the operator's. The operator's cost structure changes — and so does the valuation model for a DSP business built on workforce management as a core competency.
What the Timeline Looks Like
The Delivery Protection Act currently sits in the NYC Council with majority co-sponsorship and no scheduled hearing. Its advancement depends on whether the current Council leadership — including Speaker Menin, who is a co-sponsor — schedules it for committee review and floor vote. A change in legislative calendar or political pressure could move it quickly.
Two scenarios are worth modeling. In the first, the bill passes in some form in NYC and takes effect with an implementation window. Amazon would have to restructure its New York City last-mile operations, and DSPs currently operating NYC routes would face direct conversations about what their role is in the new structure. In the second, the bill's provisions inform state-level legislation in Albany — a path New York has used on other labor policy questions when municipal action stalls.
Operators planning fleet expansion into major metropolitan areas, refinancing existing operations, or modeling business exit valuations should include the direct employment regulatory risk in that analysis. The regulatory trajectory at the federal level (NLRB joint employer findings), the state level (California AB 5 and its commercial precedents), and now the municipal level (NYC's Delivery Protection Act) is consistently trending toward treating Amazon as a responsible party in the employment relationship.
The operators who understand what the proposed rules actually say — before they're enacted — have time to think through what it means for their business. The ones who find out when the bill passes are left working through the implications on a compressed timeline.
Sources: FreightWaves ("The high-stakes fight over New York City's renewed delivery regulation law," 2026); National Employment Law Project ("New Bill Would Force Amazon to Directly Hire its Delivery Drivers"); Streetsblog NYC ("POINT: New Yorkers Need the Delivery Protection Act — Now," February 24, 2026); International Brotherhood of Teamsters ("Amazon Teamsters Become First Union to Win Bargaining Order Against E-Commerce Giant," April 2, 2026); Bureau of Labor Statistics JOLTS (NAICS 4921, couriers and messengers, annual turnover data); SHRM (non-CDL worker replacement cost benchmarks, 2024)