DoorDash admits ‘we screwed up’ on delivery-worker pay law
DoorDash will pay $131.5 million to settle a New York City investigation into the company’s compliance with a 2023 minimum-pay law for food-delivery workers, the company said Tuesday. The settlement includes $12.3 million in direct payments to about 264,000 drivers, $83 million to resolve a dispute over how on-call time is calculated, and $16.7 million in fines to the city’s Department of Consumer and Worker Protection (DCWP).
“Simply put, we screwed up,” DoorDash said. “Our mistakes meant some Dashers were underpaid or paid late,” the company added. “While these mistakes weren’t intentional, that doesn’t make them okay,” it said.
The settlement resolves a DCWP investigation that ran for more than a year but did not result in a lawsuit against the company. DoorDash, Grubhub — now a unit of Wonder Group — and Uber Technologies’ Uber Eats had previously sued the city in an effort to block the 2023 law, but a judge denied their requests for a preliminary injunction and allowed the law to take effect.
DoorDash described the city’s law as “the most complex earning standard for delivery workers in the country” and said technical problems or complicated situations led to “many errors” in its compliance.
The $83 million portion of the settlement — the largest single component — concerns the requirement that drivers be paid for time spent on the app between deliveries, known as “on-call time.” DoorDash said it disagreed with the city’s method for calculating on-call time but would comply with it to avoid further legal battles with the city.
The $12.3 million in direct driver payments will reach around 264,000 people, including 209,000 being compensated for missing or late payments, DoorDash said. The company said it missed $6.6 million worth of payments and another $5.7 million arrived late. Sixty-five percent of drivers were underpaid by $1 or less, with a median missing payment of $7.70. Each eligible driver will receive a minimum of $10, with a median payment of about $48.
“This settlement reflects the responsibility we take for falling short,” DoorDash said. “We’ve been working to finalize this for some time and already set aside the full amount in prior quarters,” it added.
Under the agreement, DoorDash also agreed to an internal control system and reporting structure with the DCWP and appointed a compliance officer to ensure compliance with the local law.
DoorDash and New York regulators have clashed over other rules in recent years. The company sued the city in 2021 over a separate law requiring food-delivery companies to share more data with restaurants. In February 2025, DoorDash agreed to a $16.75 million settlement with New York State Attorney General Letitia James to return unpaid tips to delivery drivers.