DoorDash, the largest food delivery platform in the US, has announced a new option for its delivery workers to earn an hourly rate instead of relying so heavily tips and incentives. The company says this will provide more stability and predictability for its workers, who are classified as independent contractors.
However, as with most things in life, there’s a catch: the hourly rate option is only available for workers who accept at least 80% of the orders they are offered, and who work during peak hours and in busy areas. DoorDash says this is to ensure that customers get their orders on time and that workers are fairly compensated for their efforts.
The hourly rate option is part of DoorDash’s new program called DasherDirect, which also includes other benefits such as access to health insurance, retirement savings, and education resources. The company says it is investing $12 million in the program, which will be rolled out gradually to select markets in the US.
It’s about time
DoorDash’s move comes amid growing pressure from regulators and labor advocates to improve the working conditions and pay of gig workers. Several states, including California and New York, have passed or proposed laws that would require gig companies to classify their workers as employees and provide them with minimum wage, overtime pay, sick leave, and other benefits.
DoorDash has opposed these laws, arguing that they would reduce the flexibility and autonomy of its workers, who can choose when and where to work. The company has also faced lawsuits and criticism for its tipping policy, which was accused of subsidizing workers’ pay with customers’ tips. DoorDash changed its policy in 2019 and now pays workers 100% of their tips.
Some delivery workers have welcomed DoorDash’s new hourly rate option, saying it will help them earn more consistently and avoid low-paying orders. Others have expressed skepticism, saying it will limit their choices and force them to accept orders that are far away or unsafe. Some workers have also questioned whether DoorDash will lower the hourly rate over time or reduce the number of orders available.
DoorDash says it will continue to offer its workers the option to earn per order, and that it will monitor the feedback and performance of the DashDirect program. The company says it is committed to empowering its workers and providing them with more opportunities and support.
