DoorDash to Pay $131.5 Million in NYC Worker Underpayment Settlement
The company admits to errors that led to workers being underpaid, not paid, or paid late.
DoorDash has agreed to pay $131.5 million to settle claims that it underpaid delivery workers in New York City. The agreement, described by city officials as the largest worker settlement in the city's history, also mandates that the company implement a new monitoring system to ensure compliance with local pay laws for delivery workers.
In a statement, DoorDash acknowledged responsibility for the payment errors, stating, “While these mistakes weren’t intentional, that doesn’t make them okay. We pride ourselves on operational excellence at DoorDash – and this was not excellent, nor was it acceptable. Dashers should be paid in full, on time, every time. We are sorry to the Dashers we let down.”
According to City Hall, the majority of the settlement funds will be distributed to over 260,000 workers who were underpaid, did not receive payment, or were paid late for their deliveries. Additionally, DoorDash will pay approximately $16 million in civil penalties and other costs to the city.
Mayor Zohran Mamdani stated, “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. DoorDash underpaid more than 260,000 workers, and today we are getting that money back.”
DoorDash attributed many of the payment errors to “technical bugs or happened in complicated situations,” such as deliveries extending beyond city limits, involving multiple pickup or drop-off points, or instances where deliveries were canceled or partially completed. This settlement follows a previous agreement last year where DoorDash paid nearly $17 million to resolve claims that it had improperly used customer tips to offset the wages of its delivery workers in New York, instead of allowing drivers to retain their tips in addition to their guaranteed pay.