Published
September 16, 2026
Policymakers in New York City and Chicago are considering legislation that would effectively prohibit the Delivery Service Partner (DSP) model. The structure is used widely by logistics and delivery companies to contract with independently owned delivery operators.
Teamsters argue that the DSP model fragments the workforce and makes unionizing more difficult. Opponents counter that the proposals would eliminate opportunities for entrepreneurs who have invested capital, hired workers, and built businesses around a lawful and successful model.
This debate not about how packages are delivered. It is about the future of hundreds of independently owned delivery businesses that operate under the DSP model.
In New York City, the proposed Delivery Protection Act would require covered businesses to obtain licenses from the Department of Consumer and Worker Protection, which would also investigate complaints. A similar proposal in Chicago would license last-mile delivery facilities and prohibit subcontracted DSP operators. Union leaders have described the Chicago legislation as part of a growing movement to end the DSP model nationwide.
Among the 50 last-mile delivery facilities in New York City exceeding 50,000 square feet, nearly 30% are run by Amazon, while 60% are operated by FedEx and UPS, and the remaining 10% are tied to other logistics providers, according to an April 9 report from the New York City Committee on Consumer and Worker Protection.
A study commissioned by the Five Borough Jobs Campaign, found that instead of absorbing the costs, companies would likely move a large portion of their distribution activities to facilities outside New York City and into nearby areas like New Jersey.
“Longer travel time to routes and service areas would reduce network efficiency and eliminate dozens of stops per driver, translating to slower deliveries for NYC customers, especially in the outer boroughs,” the report said. “Same-day and next-day services would likely be curtailed, and product availability may be adjusted.”
According to the report, approximately 36% of current daily parcel volume in New York City is tied to contractor operations that are at risk from the legislation, and households and small businesses can expect higher per-package delivery costs if the legislation passes. The magnitude of the increase would depend on the extent to which carriers relocate their operations, ranging from a low estimate of $409 to a high estimate of $664 per year.
The DSP model has helped entrepreneurs build businesses, create jobs, and provide consumers with fast and reliable delivery services.
New York and Chicago should encourage investment, innovation, and entrepreneurship, not narrow the range of lawful business models available to workers, employers, and consumers.
About the author
Michael Billet
Michael Billet, director of policy research for Employment Policy at the U.S. Chamber of Commerce, keeps members and internal Chamber policy staff abreast of pending labor, immigration, and health care legislation, as well as federal regulatory and subregulatory activities. He is also responsible for planning the Chamber’s annual workplace and community wellness forum.
