Delivery workers have lost as much as $550 million in tips since Uber and DoorDash changed their apps so that the tip option appears only after customers place their orders, the city's Department of Consumer and Worker Protection charged in a new report.
The findings come as the companies sue the city over a law set to go into effect on Jan. 26 that requires them to offer the option to tip at or before checkout.
New York City's landmark minimum pay law, which guarantees delivery workers $21.44 per hour, went into effect in December 2023. The day the law went into effect, Uber and DoorDash introduced new after-checkout tipping policies in order to hide the higher costs wrought by the new minimum pay standards.
The average tip for a worker making deliveries for UberEats and DoorDash decreased from $3.66 per delivery to 93 cents per delivery in just one week after the companies moved the tipping option, DCWP found. The average UberEats or DoorDash tip has since dropped to just 76 cents per delivery.
But for the apps that kept the tipping option before checkout, like Grubhub, workers earn an average tip of $2.17 per order, according to DCWP's analysis.
“Our report blows the whistle on a massive scheme by Uber and DoorDash to drive down worker pay by more than $550 million. That era has come to an end,” DCWP Commissioner Sam Levine said in a statement. “If these companies do not follow new tipping laws going into effect later this month, they will face significant consequences.”