DoorDash to pay $131M for underpaying delivery workers in New York City

New York City Mayor Zohran Mamdani announced that DoorDash will be paying $131.5 million to settle claims of underpaying delivery workers in the city. This settlement marks the largest worker settlement in New York City's history. DoorDash admitted to the errors, stating, "Simply put, we screwed up." The company expressed regret, saying, "Dashers should be paid in full, on time, every time."

Most of the settlement, approximately $131.5 million, will be returned to over 260,000 workers who were underpaid, not paid, or paid late for their deliveries. The agreement also includes a new monitoring system to ensure compliance with New York City's delivery worker pay laws. DoorDash will also pay around $16 million in civil penalties and other costs to the city.

The underpayments were attributed to technical bugs or complex situations, such as deliveries going outside city boundaries, having multiple pickup or drop-off points, or including cancelled or incomplete deliveries. Last year, DoorDash agreed to pay nearly $17 million to settle claims of unfairly using customer tips to subsidize delivery worker wages, instead of allowing drivers to keep the tips alongside their guaranteed pay.