According to the CBS News report, DoorDash agreed to pay $131.5 million to settle an investigation by the New York City Department of Consumer and Worker Protection (DCWP) regarding allegations of underpaying and delaying payments to its delivery workers.

Key details from the settlement:

• Financial breakdown:

  • $83 million goes toward resolving a dispute over how DoorDash calculated pay for workers’ on-call time (time spent logged into the app waiting between deliveries).

  • $12.3 million will be paid directly to delivery workers who experienced delayed or deficient pay.

  • $16.7 million will go to the DCWP in fines and penalties.

  • Workers affected will receive a minimum of $10, even if the amount they were underpaid was less than that.

• Core dispute: Under New York City regulations, food delivery workers must be compensated for time spent on-call. DoorDash maintained that its calculation method was practical and legal, but stated it chose to settle rather than spend years in court, agreeing to adopt the city’s pay-calculation method going forward.

• Causes of payment discrepancies: DoorDash acknowledged operational and technical errors, including issues with deliveries that crossed city boundaries, orders involving multiple drop-offs or pickups, canceled or partially completed orders, and instances where drivers entered incorrect or incomplete banking information.

• Next steps: The company announced it has corrected the technical issues causing the payment errors and will begin contacting all eligible NYC Dashers in the coming weeks to distribute their owed funds.