DoorDash to pay $131.5M to 264,000 NYC delivery workers in city's largest-ever labor settlement

DoorDash will pay $131.5 million to settle a New York City investigation into wage violations — the largest labor enforcement action in the city's history — after the company admitted it underpaid or delayed wages to roughly 264,000 delivery workers. Standing at City Hall on Tuesday, Mayor Zohran Mamdani announced the agreement and issued a warning to other companies: 'If you keep trying to rip off New Yorkers, we will be happy to make history again.'

Simply put, we screwed up. Our mistakes meant some Dashers were underpaid or paid late. While these mistakes weren't intentional, that doesn't make them OK.— DoorDash, company statement

Of the $131.5 million total, nearly $115 million goes directly to affected workers — whom DoorDash calls Dashers — with a median payout of about $48. But the distribution is uneven: about 4,000 workers are set to receive more than $5,000 each, and about 27,000 will receive more than $1,000, according to Gothamist. The remaining $16.7 million is a civil fine paid to the city. Payments are expected to go out in late October.

The settlement breaks down into two main disputes. About $83 million resolves a disagreement over how to calculate pay for workers who were logged into DoorDash's app but not actively making deliveries — so-called idle or on-call time. Another $12.3 million covers payments that were missed entirely or arrived days or weeks late, according to the Guardian.

According to DoorDash, the mistakes stemmed from deliveries that crossed city boundaries, involved multiple pickup or drop-off locations, were partially fulfilled or canceled, encountered technical bugs, or were tied to workers with incomplete banking information. The company said it has since fixed the technical issues that caused the mistakes.

For years, DoorDash failed to count every hour worked by delivery workers. This was not a rounding error or an accidental mistake.— Zohran Mamdani, Mayor of New York City

Mamdani said DoorDash used 'greedy algorithms' to avoid complying with a 2023 city law intended to improve pay for delivery workers — a law that itself grew out of a 2021 minimum pay measure that set food delivery workers' hourly minimum at $19.56. The investigation was opened by the city's Department of Consumer and Worker Protection (DCWP) under former Mayor Eric Adams, after a group of delivery workers filed formal complaints alleging they had been shorted or paid late.

Rosendo Tacam, a Queens resident and leader of Los Deliveristas Unidos — a worker group that came together during the pandemic to push for better pay and conditions — was among those affected, saying DoorDash had failed to pay him for a full week of work.

Despite everything we went through on the streets, today we know we are not alone.— Rosendo Tacam, delivery worker and Los Deliveristas Unidos leader

Workers' Justice Project Executive Director Ligia Guallpa credited workers like Tacam for making the settlement possible, and said the enforcement effort 'really accelerated' after Mamdani took office in January 2026. The political backdrop adds texture: DoorDash had spent $2.8 million in super PAC money supporting Mamdani's opponent, former Gov. Andrew Cuomo, during the mayoral race, according to Gothamist.

As part of the agreement, DoorDash must submit detailed pay data to the city every month for three years, and the city will create a dedicated app for workers to report potential wage violations directly. The settlement does not resolve questions about rival platforms: city officials declined to say whether Uber Eats and Grubhub are complying with the 2023 law. Uber declined to comment; Grubhub did not respond to requests for comment. The DCWP had previously accused both DoorDash and Uber Eats of using 'design tricks' to deprive workers of more than $550 million in tips — an allegation that predates Tuesday's settlement by nearly eight months, according to the Guardian.

To put the figure in context, Gothamist reported that New York City's previous largest labor enforcement action was a settlement of roughly $35 million reached with Starbucks in December 2025, following allegations that the company denied thousands of workers stable schedules and arbitrarily reduced their hours.

Why it matters — The settlement sets a new benchmark for city enforcement of gig-economy wage laws and puts every other food delivery platform in New York City on notice that the same scrutiny is coming.

Reported by theguardian.com, thehill.com, nytimes.com, gothamist.com