DoorDash to pay $131.5m in NYC delivery worker settlement
DoorDash will pay $131.5 million to resolve New York City findings that it failed to pay delivery workers fully or on time and violated the city’s minimum-pay requirements, according to HRMorning. The settlement, announced by the New York City Department of Consumer and Worker Protection, is the largest in city history and the largest U.S. municipal settlement involving food-delivery workers.
The nine-figure worker settlement will provide more than $115 million to over 260,000 current and former delivery workers. The city found DoorDash excluded certain trip and on-call time when calculating compensable work time after the city began enforcing its delivery-worker minimum-pay rate in December 2023.
How the pay violations occurred
After New York City began enforcing its delivery-worker minimum-pay rate in December 2023, DoorDash allegedly excluded certain trip and on-call time when calculating compensable work time. This resulted in workers not being paid fully or on time. HRMorning reported that workers paid late will receive about twice the amount underpaid, while workers who received no payment will receive about three times the amount owed.
Who receives the settlement funds
More than $115 million from the settlement will go to over 260,000 current and former delivery workers. The distribution is based on the city’s findings: workers who were paid late will receive about twice the amount underpaid, and those who received no payment will receive about three times the amount owed. The settlement is the largest in NYC history and the largest U.S. municipal settlement involving food-delivery workers.
What this means for HR and payroll teams
This case highlights the importance of accurately tracking all compensable time, including trip and on-call time, for workers who are subject to minimum-pay requirements. HR and payroll teams should review their timekeeping and payroll practices to ensure compliance with local wage laws. Rules vary by jurisdiction, so employers should consult legal counsel familiar with the specific requirements in each location where they operate.
Background on the enforcement
New York City began enforcing its delivery-worker minimum-pay rate in December 2023. The city’s Department of Consumer and Worker Protection investigated DoorDash’s practices and found violations. The settlement resolves those findings without admission of liability by DoorDash, according to HRMorning.
Sources: HRMorning
