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DoorDash has agreed to pay a $131.5m (\u00a399m) settlement to New York City regulators after the food delivery giant admitted failing to compensate thousands of workers correctly or on time. <\/b><\/p>\n
“Simply put, we screwed up,” DoorDash said. “Our mistakes meant some Dashers were underpaid or paid late.”<\/p>\n
The agreement with the Department of Consumer and Worker Protection follows a city investigation into wage violations, with a significant share of the payout addressing how DoorDash calculates compensation for the time delivery drivers spend waiting for orders. <\/p>\n
The settlement marks another chapter in an ongoing battle between so-called gig economy platforms and municipal leaders.<\/p>\n
The likes of Uber Eats and Grubhub have repeatedly clashed with city officials over tipping laws, minimum wages and data-sharing requirements.<\/p>\n
The majority of DoorDash’s settlement – $83m – is to resolve a disagreement over how to calculate pay for the time workers spend online between deliveries.<\/p>\n
Pay for idle time between orders is a major industry flashpoint. <\/p>\n
Traditionally, apps only paid drivers during active deliveries but New York’s rules require compensation for all time logged into the app. <\/p>\n
San Francisco-based DoorDash blamed “complex” changes to the minimum wage in New York state introduced in 2023. <\/p>\n
Under the landmark minimum pay standard for app-based delivery workers, wages differ depending on the county, tipping and how many people work for the employer.<\/p>\n
DoorDash also cited technical glitches and multi-stop delivery routes for causing the firm to underpay workers or delay wages. <\/p>\n
The company said: “While these mistakes weren’t intentional, that doesn’t make them okay.”<\/p>\n
DoorDash said local workers earn roughly $30 per active hour on average. It said it has now patched the software bugs responsible for the mistakes.<\/p>\n
The business said the errors hit roughly 264,000 workers, though it insisted the issues affected under 1% of overall local transactions.<\/p>\n
Systemic errors caused around $6.6m wages to never reach workers at all, and another $5.7m arrived days or weeks late.<\/p>\n<\/div>\n