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DoorDash, the nation’s biggest on-demand food delivery app, is dropping a widely criticized tipping policy that effectively meant customers’ tips were going to DoorDash rather than the worker who delivered their meal.
The decision follows days of widespread outrage and angry customer complaints about the policy after a New York Times reporter described it in an article about what it was like to work as a deliveryman for the company.
“Going forward,” DoorDash’s chief executive, Tony Xu, wrote on Twitter on Tuesday night, “we’re changing our model — the new model will ensure that Dashers’ earnings will increase by the exact amount a customer tips on every order. We’ll have specific details in the coming days.”
Delivery people who work for the company are known as Dashers. DoorDash says it has over 400,000 Dashers nationwide.
Under the policy, which the company adopted in 2017, DoorDash would offer a Dasher a guaranteed minimum amount to do a delivery. If a customer tipped, in most cases a tip paid through the app would go to subsidizing DoorDash’s contribution toward the guarantee, rather than increasing the Dasher’s pay.
For example, if DoorDash guaranteed a worker $7 for a delivery and a customer did not tip, DoorDash would directly pay the worker $7. If the customer tipped $3 via the app, DoorDash would directly pay the worker only $4, then add on the $3 tip so that the worker would still get only $7.
DoorDash, which was valued at $7.1 billion after a round of financing this year, has faced bad publicity about the policy before.
In February, Instacart, a grocery delivery app, dropped a similar tipping policy in the wake of a shaming campaign, and DoorDash was pressured to follow suit.
At the time, Mr. Xu stood firm. “This is a model that is built with Dashers in mind,” he said then. “The pay model is meant to make sure every order is worth fulfilling.”
But after The Times published an article on Sunday by a reporter who spent days working as a deliveryman for DoorDash and other food apps, the blowback reignited on social media.
Thousands of people blasted the company, swore they would tip DoorDash workers only in cash or said they had deleted the app altogether.
“I don’t believe that a single person intends to give a tip to a multibillion dollar venture-backed start-up,” a tech journalist, Louise Matsakis, wrote in a tweet that was retweeted thousands of times. “They are trying to tip the person who delivered their order. This deceptive model should be illegal.”
All the other major delivery apps, including GrubHub and Uber Eats, give workers 100 percent of tips, though some, including Uber Eats, typically pay less per job than DoorDash, not counting the tip.
In his Twitter thread last night, Mr. Xu wrote that under the model that was being dropped, DoorDash’s average contribution to Dashers was the same as it had been under the pre-2017 model. Before 2017, DoorDash paid Dashers a flat fee per delivery, plus any tip from the customer.
“But it’s clear from recent feedback that we didn’t strike the right balance. We thought we were doing the right thing by making Dashers whole when a customer left no tip,” he wrote.
“What we missed was that some customers who did tip would feel like their tip did not matter.”