DoorDash will pay $131.5 million to settle claims that the company underpaid delivery workers in New York City, Mayor Zohran Mamdani announced Tuesday.
The agreement, described by officials as the largest worker settlement in New York City history, also requires DoorDash to implement a new monitoring system to ensure compliance with local delivery worker pay regulations.
In a statement, DoorDash acknowledged mistakes and said the company had failed to meet its own standards.
“Simply put, we screwed up,” DoorDash said. “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.”
More than 260,000 workers affected
Most of the settlement funds will be returned to more than 260,000 delivery workers who were underpaid, unpaid or paid late for completed deliveries, according to New York City officials.
DoorDash will also pay approximately $16 million in civil penalties and additional costs to the city.
“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,” Mamdani said. “DoorDash underpaid more than 260,000 workers, and today we are getting that money back.”
DoorDash cites payment system errors
DoorDash said many payment issues resulted from technical problems or complex delivery situations, including orders that crossed city boundaries, involved multiple pickup or drop-off locations, or included cancelled or partially completed deliveries.
The company said the errors were not intentional but acknowledged that affected workers should have received their full payments.
Previous New York delivery worker settlement
The settlement follows a previous agreement last year in which DoorDash agreed to pay nearly $17 million over allegations that it improperly used customer tips to offset delivery worker wages in New York.
That case involved claims that drivers were not allowed to keep customer tips in addition to their guaranteed pay.
