5 hrs ago
DoorDash Reaches $131.5 Million Settlement Over NYC Worker Pay
DoorDash agreed to pay money to delivery workers in New York City.
The city said some workers were paid too little or were paid late.
The company will pay $131.5 million to settle the investigation.
About 264,000 workers are expected to receive money.
Every affected worker will get at least $10, even if the missing amount was smaller.
The disagreement partly involved whether waiting for orders should count as paid time.
New York City’s rule says delivery companies must pay at least $22.13 per hour for delivery and qualifying waiting time.
The city also said delivery apps raised fees and changed tipping screens after the rule began.
DoorDash acknowledged that mistakes caused some workers to be underpaid or paid late.
DoorDash agreed to pay $131.5 million to settle a New York City investigation into delivery-worker pay.
More than $83 million addresses disputes over calculating couriers’ waiting time, while $12.3 million covers underpaid or late payments.
DoorDash will pay $16.7 million in fines to the Department of Consumer and Worker Protection.
About 264,000 workers will receive compensation, with every affected courier receiving at least $10.
The settlement follows disputes over New York City’s $22.13 hourly minimum-pay rule and changes to delivery fees and tipping prompts.
- Who
- DoorDash, New York City Mayor Zohran Mamdani’s administration, the Department of Consumer and Worker Protection, and approximately 264,000 delivery workers.
- What
- DoorDash agreed to a $131.5 million settlement over alleged underpayments, late payments, and disputes about calculating courier waiting time.
- Where
- New York City, including disputes involving workers outside the city who remained available for deliveries within its five boroughs.
- When
- The settlement was announced Tuesday; New York City’s minimum-pay rule took effect in 2023.
- Why
- The settlement addresses DoorDash’s acknowledged payment errors and the city’s investigation into compliance with its delivery-worker minimum-pay rules.
New York City Administration
DoorDash
Calculating waiting time
New York City Administration
The city’s minimum-pay rule counts delivery-trip time and time spent waiting between orders, including qualifying time for workers available to accept deliveries in the city.
DoorDash
DoorDash disputed how waiting time should be calculated when couriers were outside New York City, such as in New Jersey or Long Island, while available for city deliveries.
Payment errors
New York City Administration
The administration said workers must receive wages on time and in full and pursued compensation for underpaid or late payments.
DoorDash
DoorDash acknowledged that it made mistakes, said some New York City Dashers were underpaid or paid late, and agreed to pay what workers were owed.
Fees and tipping changes
New York City Administration
The Mamdani administration said app interface changes deprived delivery workers of $550 million in tips; its analysis also cited lower tips and higher fees after the pay rule began.
DoorDash
DoorDash and Uber passed some additional costs to consumers through higher fees and moved tipping prompts until after orders were placed, according to the article.
Key facts
- Settlement value
- $131.5 million
- Waiting-time dispute
- More than $83 million
- Underpaid or late payments
- $12.3 million
- City fines
- $16.7 million paid to the Department of Consumer and Worker Protection
- Workers affected
- Approximately 264,000
- Minimum-pay rate
- $22.13 per hour under New York City’s rule
- Median settlement payment
- About $48
- Minimum individual payment
- At least $10 for every affected courier
Quotes
Zohran Mamdani
New York City mayor
“When a worker earns a wage, they deserve to be paid that wage — not tomorrow, not after a lawsuit, but on time and in full.”
livemint.com
DoorDash
Delivery platform issuing a statement about the settlement
“We screwed up, and our mistakes meant some NYC Dashers were underpaid or paid late”
livemint.com
Sources
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