DoorDash settles with NYC for $131M over underpaid delivery workers

Key Points:

• New York City Mayor Zohran Mamdani criticized DoorDash CEO Tony Xu for promoting a "greedy algorithm" business model amid the announcement of a historic $131.5 million settlement with DoorDash over alleged tip withholding from delivery drivers.
• The settlement, the largest ever for food delivery workers in U.S. municipal history, allocates $115 million directly to affected delivery workers, with some receiving up to $5,000, and funds for fines and software development to monitor DoorDash's payment practices.
• DoorDash admitted to unintentionally underpaying drivers but apologized for the errors, while Mamdani insisted the misconduct was deliberate, citing systematic exclusion of certain work hours from pay calculations.
• Under the settlement, DoorDash must submit regular delivery worker payment data to the city for three years and enable workers to crowdsource data to investigate the algorithms affecting their schedules and pay.
• This settlement follows previous actions by Mamdani targeting food delivery companies, including a $5 million settlement with Uber Eats and nearly $1 million with HungryPanda for related labor and fee violations.