DoorDash Reaches Record $131.5M NYC Worker Settlement
DoorDash Reaches Record $131.5M NYC Worker Settlement
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DoorDash said payment errors arose in complex delivery scenarios, including trips that crossed city boundaries, involved multiple pickup or drop-off locations, or were canceled or only partially completed.
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DoorDash acknowledged the failures in unusually direct terms, saying, “Simply put, we screwed up,” and apologized to the affected Dashers.
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The settlement follows a separate agreement last year in which DoorDash paid nearly $17 million over allegations that it used customers’ tips to subsidize guaranteed wages rather than paying tips on top of those wages.
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DoorDash said it had considered its own pay-calculation approach “fair, practical, and legal,” but opted to adopt the city’s method rather than spend years litigating the disagreement.
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New York City officials said the enforcement effort reflects a crackdown that has spanned three mayoral administrations, with Mayor Zohran Mamdani declaring that “no corporation is above the law.”
DoorDash will pay $131.5 million to settle a New York City investigation into underpaying delivery workers, marking the largest worker settlement in city history. Around 260,000 to 264,000 delivery workers will receive compensation for wages that were underpaid, unpaid, or paid late NBC New York.
The settlement breaks down into three parts: $83 million for pay calculation disputes about time spent online between deliveries, $12.3 million in direct payments to workers, and $16.7 million in fines to the city AM New York. DoorDash said technical errors and incomplete banking information caused the payment problems Daily Breeze.
How Payment Errors Happened Across the City
DoorDash blamed payment issues on complex delivery scenarios that the company's system struggled to process. These included deliveries crossing city boundaries, multiple pickup or drop-off locations, canceled orders, and partially completed trips AM New York. The company acknowledged these failures in unusually direct terms, saying 'Simply put, we screwed up' NBC New York.
DoorDash Abandons Its Own Pay Calculation Method
DoorDash previously considered its pay-calculation approach 'fair, practical, and legal,' according to company statements Food Manufacturing. Rather than spend years fighting the city in court, DoorDash agreed to adopt New York City's calculation method going forward. The company will also face enhanced monitoring to ensure future compliance with city wage laws San Bernardino Sun.
Part of a Larger Crackdown on Gig Economy Pay
This settlement follows a separate agreement last year when DoorDash paid nearly $17 million over allegations that it used customer tips to subsidize guaranteed wages instead of paying tips on top of them. Mayor Zohran Mamdani declared that the enforcement effort 'reflects a crackdown that has spanned three mayoral administrations' and that 'no corporation is above the law' Food Manufacturing.
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