Tipped workers are among the lowest-paid in the US economy. When consumers pay a tip at a restaurant or to a delivery driver, they trust that that money goes directly to the worker. However, the complaint for this class action alleges that tips entered into the DoorDash, Inc. app do not go to the drivers who bring their deliveries but to DoorDash, in whole or in part.
The class for this action is all consumers who used DoorDash and paid a tip through the DoorDash app within the statutory period.
The central allegation in this action was outlined in a July 21, 2019 New York Times article entitled, “What Our Reporter Learned Delivering Burritos to New Yorkers.” For the article, reporter Andy Newman worked as a food app delivery worker for DoorDash.
The complaint reports that “for almost two-thirds of his food deliveries, he received no tip.” This is because when tips are made using the app, as the article says, DoorDash “effectively pockets tips made via the app[.]” For the worker to actually receive the tip, the customer must hand the tip directly to the delivery worker in cash.
This is because the company adopted a policy in 2017 of guaranteeing a delivery worker a certain amount for each delivery. If, for example, it guarantees a worker $7 for a delivery, and the customer does not tip, the worker gets the promised $7 from DoorDash. If, however, the customer tips $3 via the app, DoorDash pays the worker $4 directly and adds in the $3 tip to arrive at the promised $7.
The complaint alleges that this effectively is an overpayment of the $3 from the customer to DoorDash.
It seems that DoorDash has now changed its policy due to an outcry from customers. On July 24, 2019, another New York Times article reported that DoorDash had announced that it would discontinue the policy.
The complaint thus claims, “DoorDash has admitted that the tip amount entered by the customer on the DoorDash app was largely subsidizing its labor costs, rather than rewarding the delivery worker with extra pay for good service. It quotes a tech journalist as saying, “I don’t believe a single person intends to give a tip to a multibillion dollar venture-backed start-up… They are trying to tip the person who delivered their order.” She called the practice a “deceptive model” and said that it “should be illegal.”
The counts include violations of state consumer protection laws, including New York’s General Business Law, and fraud, among other things.