The investigation by the New York attorney general, Letitia James, found that under this model DoorDash used tips from customers to offset the base pay it guaranteed to workers rather than giving them the full tips.
According to the attorney general’s office, if a customer tipped nothing, the delivery worker would receive the full amount of guaranteed pay for the delivery, such as $10, but if the customer tipped $3 on top that, they would still only receive $10 for the order.
The delivery platform DoorDash is paying $16.75m to settle an investigation conducted by New York authorities that charged the company with using tips from customers to subsidize workers’ base pay.
Workers were only able to see tips if they were greater than the base pay the app had already guaranteed to pay, with the company paying at least $1 and then using tips to subsidize the rest of the guaranteed wage.
Between May 2017 and September 2019, DoorDash used a guaranteed pay model to show delivery workers how much they would make before accepting a delivery.
