DoorDash offers delivery drivers an hourly rate, but there’s a catch

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By Webdesk

DoorDash is giving delivery drivers the option to get a guaranteed minimum hourly rate instead of per delivery, the company said Wednesday. The new option, a novelty in the gig worker industry, comes as DoorDash and other app-based gig companies such as Lyft and Uber must provide New York City delivery drivers with a guaranteed minimum wage of $18 per hour.

While DoorDash has positioned this new offering as a way to maintain flexibility while promoting reliable revenue, the hourly rate is not Real an hourly rate. It is based on the time spent on a delivery, “from the moment [a worker accepts] an offer until it is delivered – plus 100% tips,” the company said.

“We know there are Dashers who prioritize reliability in their earnings, who just want to hit the road and have an immediate idea of ​​exactly how much they will earn for the time it takes to complete an order,” reads one blog post from DoorDash. “Earn by Time was developed exactly with those Dashers in mind.”

Labor rights activists and gig workers have historically criticized DoorDash and other companies for only paying workers for the time they spend performing, or “active time,” because that doesn’t account for time spent waiting on an order. The NYC mandate requires companies to pay employees for all the time they are connected to the app.

It’s not clear how much DoorDash will offer its Dashers (the term the company uses to describe its delivery drivers) as a minimum hourly rate, and the company did not respond to TechCrunch’s request for comment in time.

DoorDash has tested this hourly wage model in a few small to mid-sized cities in the US. employees to accept less desirable orders that they would normally reject due to low base pay.

Proposition 22 was a California ballot initiative passed in 2020 and upheld in the appellate court in March 2023, and allows companies like DoorDash to continue to classify their employees as independent contractors rather than employees.

The guaranteed hourly rate is shown to Dashers at the start of a ride, so they can see exactly how much they’re making per hour upon delivery. DoorDash said it has “invested significantly” to create a “rewarding, valuable option for those Dashers who prioritize consistency when dashing.” In other words, Dashers who accept more orders will likely see a higher hourly rate than those who don’t. DoorDash, Uber and other gig companies are known for rewarding employees who consistently accept travel, and they have been accused of punishing employees who don’t.

The traditional earn-per-offer option is still available to Dashers, showing the pre-guaranteed minimum amount they can expect to earn on that trip before accepting.

DoorDash did not say which states and markets the “earn on time” offer will be available in.

In addition to announcing hourly wages, DoorDash included the launch of some new features designed to help Dashers maximize their earnings. For example, “dash along the road” employees can select where they want to start fulfilling orders — perhaps during their normal commute — so they can receive orders at those locations.

DoorDash also introduced post-checkout tips, allowing customers to tip or add to an existing tip up to 30 days after a delivery. Usually, customers tip at checkout, but this option gives Dashers a chance to earn a little more for a job well done.

To give Dashers peace of mind, DoorDash also launched a location sharing feature, which allows employees to share their location with up to five contacts.

As the latest bot to be thrown at gig workers, DoorDash said it’s giving a one-time gift of $10,000 to Dashers who joined the platform in the early years, completed more than 10,000 deliveries, and are still active on the platform. The company does not want to say how many Dashers that is.

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