DoorDash Finally Agrees To Fix Unpopular Tipping Policy [Updated]
Update, July 24, 2019: It took months of driver complaints and a New York Times exposé, but DoorDash's CEO Tony Xu announced on Twitter yesterday the company will change course on its tipping policy. Until now, DoorDash could use a portion or all of a customer's tip toward drivers' base pay rate; now, Xu says "Dashers' earnings will increase by the exact amount a customer tips on every order." Details are still being ironed out, but Xu promises details in the coming days.
Original story, June 28, 2019: In February, an NBC News exposé revealed that customers' tips on certain food-delivery app orders weren't being applied to drivers' pay the way many people would assume. Instead of being applied as a gratuity above and beyond the driver's base pay, DoorDash and Instacart sometimes used those tips to pay a driver's base rate. Instacart swiftly updated its policy following criticism, ensuring that tips would go to drivers on top of their base rate. For its part, DoorDash said it would conduct a review of its policies—four months later, the review is finished, and DoorDash says it's sticking with its original policy.
Forbes reports DoorDash isn't changing the way it sometimes applies tips to drivers' base pay, but will make several steps to address other drive concerns. (This is no insignificant point; Fast Company reports DoorDash pads drivers' base pay with tips on 85% of orders.) Most significantly, the company is making driver payments more transparent by listing the payment breakdown for each order so drivers can see exactly how much of their pay comes from the company versus a customer's tip. It will also begin paying drivers more for certain longer trips, and will add "occupational accident insurance" in case drivers are injured while working.
Those steps are well and good. But they're unlikely to quell the firestorm surrounding DoorDash and delivery apps more generally. In March, hundreds of tech workers signed a pledge vowing not to work for DoorDash until it pays drivers at minimum $15 per active hour of work. And just this week, New York City held a public hearing on restaurants' concerns about third-party delivery apps. Of course, until investors stop funding these companies, customers stop ordering from them, and drivers walk off the job, these apps will continue to see such gripes as mere background noise.