DoorDash announced on Wednesday that it will provide its delivery workers with the option to be paid a guaranteed hourly minimum rate instead of the traditional per-delivery payment structure. This move comes as DoorDash and other gig economy companies like Uber and Lyft are required to comply with New York City’s mandate, which sets a minimum wage of $18 per hour for delivery workers.
Although DoorDash presents this new offering as a means to offer both flexibility and reliable earnings, it is important to note that the hourly rate is not a true hourly wage. The rate is calculated based on the time spent on a delivery, “from the moment a worker accepts an offer until it’s dropped off – plus 100% of tips,” according to the company’s statement.
DoorDash explained in a blog post that the “Earn by Time” feature was developed specifically for those delivery workers who prioritize predictable earnings and prefer to have a clear idea of how much they will earn for completing an order. The company has been testing the hourly pay model in smaller cities across the United States.
Critics, including labor rights activists and gig workers themselves, have previously raised concerns about DoorDash and similar companies only compensating workers for active time spent on a gig, neglecting the time spent waiting for orders. The New York City mandate requires companies to pay workers for the entire duration they are connected to the app, including waiting time.
While DoorDash did not disclose the specific hourly rate it will offer Dashers (the term used to describe its delivery workers), the guaranteed rate will be displayed to workers at the beginning of each trip. This transparency allows Dashers to know their expected earnings per hour. DoorDash emphasized that it has made significant investments to create a rewarding option for Dashers seeking consistency.
DoorDash also unveiled additional features designed to help Dashers maximize their earnings. For instance, “dash along the way” enables workers to select specific locations where they prefer to fulfill orders, such as along their regular commutes. DoorDash also introduced post-checkout tipping, allowing customers to add or increase tips up to 30 days after a delivery.
To provide further support, DoorDash introduced a location sharing feature that allows Dashers to share their whereabouts with up to five contacts. Additionally, the company announced a one-time gift of $10,000 for Dashers who joined the platform in its early years, completed over 10,000 deliveries, and remain active on the platform.
The availability of the “earn by time” option in different states and markets has not been disclosed by DoorDash at this time.
