They believed that their tip was not mandatory and considered it an extra payment rewarding their delivery person on top of their base pay.
According to the suit, in Washington, D.C. alone,"millions of dollars in tips were used to subsidize DoorDash's payments to Dashers ." Racine seeks to recover the tip money and also impose civil penalties against the delivery service company.
A DoorDash spokesperson replied to the controversy,"We strongly disagree with and are disappointed by the action taken today. Transparency is of paramount importance, which is why we publicly disclosed how our previous pay model worked in communications specifically created for Dashers, consumers and the general public starting in 2017. We've also worked with an independent third party to verify that we have always paid 100% of tips to Dashers.
The lawsuit is part of a new awakening by regulators and state officials over the practice of tech companies—with app-based business models—reliant upon independent contractors. A new law passed in California will reclassify some on-demand contractors as employees. The law will go into effect in January, but companies that earn a fortune from using gig-economy, independent contractors, such as Uber, Lyft, DoorDash and Instacart, are fighting against it.
It's not just DoorDash; other delivery services, such as Instacart and Amazon Flex, were also accused of using workers’ tip money to subsidize their delivery persons’ pay. An online post by an Instacart shopper went viral when the contractor was paid a handsome
That could probably be easily proven.
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