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ARTICLE · 04 APRIL 2025

DoorDash's $16.75M Lesson: When Perception Meets Pay Transparency

O'Toole Scrivo
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The Office of the New York State Attorney General ("NYOAG") recently announced a $16,750,000 settlement with DoorDash, Inc., highlighting the importance of transparency in communications regarding pay practices.

United StatesEmployment and HR
Nicole DeMuro
Nicole DeMuro
Adam Flannery
Adam Flannery

The Office of the New York State Attorney General ("NYOAG") recently announced a $16,750,000 settlement with DoorDash, Inc., highlighting the importance of transparency in communications regarding pay practices. The settlement arose from an investigation examining DoorDash's handling of customer tips between 2017 and 2019, and the NYOAG's finding that such practices violated New York General Business Law § 349, which prohibits deceptive business practices.

The investigation found that DoorDash promised delivery "Dashers" a "Guaranteed Amount" as payment for each delivery. Customers could then add a "Dasher Tip" and were told, "Dashers will always receive 100 percent of the tip." While customers were never advised of the Guaranteed Amount, the NYOAG opined that DoorDash led customers to believe that Dashers would receive the tips in addition to the Guaranteed Amount. Instead, DoorDash used the tips to offset the Guaranteed Amount, often resulting in Dashers receiving

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