DoorDash has agreed to pay nearly $17 million to settle claims that it used customer tips to subsidize the wages of its delivery workers in New York between May 2017 and September 2019, according to Attorney General Letitia James. During this period, DoorDash guaranteed workers a base payment for each delivery but factored tips into the equation, only paying workers for the difference not covered by tips. Customers were not informed that their tips were being used to offset worker wages. “This is just fundamentally unfair,” James stated at a news conference, noting that customers had no reason to believe their tips were reducing DoorDash’s costs. The settlement will distribute $16.75 million in restitution to eligible DoorDash workers who made deliveries during the specified period. In response, DoorDash stated, “While we believe that our practices properly represented how Dashers were paid during this period, we are pleased to have resolved this years-old matter and look forward to continuing to offer a flexible way for millions of people to reach their financial goals.” The company confirmed that the old pay model is no longer in use. — news from The Associated Press
