DoorDash, a leading food delivery service, has agreed to pay nearly $17 million to delivery drivers in New York as part of a settlement addressing claims that the company improperly used drivers’ tips to supplement their wages. This resolution comes after scrutiny over DoorDash’s compensation practices, particularly in relation to the payments drivers receive for their services.

The settlement is part of a larger trend in which gig economy companies are facing legal challenges concerning the treatment and compensation of their workers. Drivers alleged that DoorDash had allocated their tips to meet minimum wage guarantees, which contradicts the company’s policy of passing 100% of tips directly to workers. The settlement aims to provide restitution to affected drivers and reinforce the practice of fair compensation within the gig economy.

As part of the agreement, DoorDash will also implement changes to enhance transparency in its pay practices, ensuring that drivers are fully aware of how their earnings are calculated and distributed. The company emphasized its commitment to fair treatment and compensation for its delivery personnel.