San Francisco reaches $5.3M settlement with DoorDash over courier benefits

The settlement resolves allegations that DoorDash failed to provide minimum health care coverage and sick leave to its workers.

San Francisco’s labor laws require a company with more than 20 employees to spend a minimum amount on health care benefits per employee and to offer sick leave to all employees in the city.

DoorDash will pay more than $5.3 million to settle allegations brought by the city of San Francisco that it failed to provide minimum health care coverage and sick leave to its couriers, City Attorney David Chiu announced Monday.

The agreement stems from a complaint San Francisco Supervisor Aaron Peskin filed with the city’s Office of Labor Standards Enforcement three years ago. San Francisco’s labor laws require a company with more than 20 employees to spend a minimum amount on health care benefits per employee and to offer sick leave to all employees in the city.

The settlement affects nearly 4,500 DoorDash couriers who made deliveries in San Francisco between 2016 and 2020, according to the city attorney’s office.

“We are living through an era of deep inequality, and nothing could be more important than ensuring workers are paid fairly and their benefits are safeguarded,” Chiu said in a prepared statement. “The city conducted a thorough, diligent investigation that resulted in this unprecedented settlement for San Francisco workers.

In a statement, DoorDash denied any wrongdoing. “We feel that this settlement represents a fair compromise that will allow us to focus on continuing to provide the best experience for Dashers,” the company statement said.

The settlement does not change DoorDash’s classification of its workers as independent contractors, which continues to be the subject of litigation. In June 2020, San Francisco District Attorney Chesa Boudin sued DoorDash for alleged violations of state employee-status laws. Four months later, voters approved Proposition 22, which allows app-based delivery and driver companies to continue treating workers as independent contractors.

In October, Boudin and DoorDash attorneys from Gibson, Dunn & Crutcher filed a stipulation in San Francisco County Superior Court noting that while they still disagree about the proper classification of DoorDash couriers before Proposition 22 took effect, the city is no longer seeking injunctive relief.

The settlement announced Monday is the largest ever secured by the Office of Labor Standards Enforcement in the agency’s 20-year history.

More than $5.1 million of the settlement will go to DoorDash couriers, according to the city attorney’s office. The remaining money—$187,046—will cover the city labor enforcement office’s investigation costs.