Another month, another announcement from DoorDash CEO Tony Xu about how the food-delivery service plans to improve worker pay. The company has been roundly criticized this year for a system in which customer tips are considered part of pay for its “Dasher” delivery contractors, with DoorDash contributing as little as $1 from its own pocket on high-tip jobs.
Xu announced a change last month via Twitter, so that “Dashers’ earnings will increase by the exact amount a customer tips on every order.” Following weeks of silence, Xu finally revealed in a blog post today that the new pay policy will take effect next month, along with some other changes.
The upshot: DoorDash’s minimum payment has increased from $1 to $2.
The new base pay could go as high as $10, said Xu, depending on the estimated duration, distance, and desirability of the order. But yeah: Dashers could be offered assignments with base pay of just $2, making the tip more or less essential to their compensation, rather than a bonus. (Dashers will see the tip amount before accepting a gig, he said.) For perspective: Grocery delivery service Instacart—also bowing to public pressure on how it handles tips—instituted a guaranteed base pay of $5 to $10 in February.
Dashers aren’t required to accept any assignments, DoorDash tells Fast Company. And the company could well pay more than the $2 to $10 base. Xu’s post said that the company will also be offering new types of pay bumps “in the coming months.” They include “Peak Pay” for busy times and “Challenge Bonuses [that] will better reward more active Dashers and help them meet specific earnings goals for the week.”
“Under our new model, Dashers will earn more money on average—both from DoorDash and overall,” claimed Xu. Time—and the take-home pay for Dashers—will tell.