DOORDASH TO PAY $131.5M OVER NEW YORK WORKER UNDERPAYMENT

DoorDash has agreed to pay $131.5m to settle a New York City investigation into the underpayment of delivery workers, Mayor Zohran Mamdani announced. He described it as the largest labour enforcement action in the city's history. Nearly 264,000 workers, known as Dashers, are due backpay under the deal, with a median payout of about $48. DoorDash said in a statement, "Simply put, we screwed up," adding that the errors were unintentional but unacceptable, and it was sorry to the workers it had let down.

Of the total, nearly $115m goes directly to affected workers and DoorDash accepted a civil fine of about $16.7m, city figures show. Roughly $83m resolves a dispute over pay for workers logged into the app but not actively delivering, while a further $12.3m covers payments that arrived late or were missed. DoorDash attributed some errors to technical bugs, including orders crossing city boundaries and trips that were cancelled or partly completed. The company must now submit monthly pay data to the city for three years under the city's 2023 delivery pay law.

The settlement follows a separate investigation, opened about eight months earlier, in which the city accused DoorDash and Uber Eats of using "design tricks" that deprived workers of more than $550m in tips. Mamdani said DoorDash's use of "greedy algorithms" meant it failed for years to count every hour worked, calling it "not a rounding error or an accidental mistake." City officials declined to say whether Uber Eats or Grubhub are complying with the 2023 law, and Uber declined to comment. DoorDash separately paid almost $17m last year over claims that customer tips had been used to subsidise workers' base pay.