Postmates paid out more than $250,000 to 2,975 gig workers in Seattle as a result of the premium pay mandate. | Shutterstock
Both companies conducted voluntary audits around compliance with the new mandate
The enforcement of a new Seattle law designed to offer gig workers hazard pay during the pandemic seems to be paying off. As announced late last week by the Seattle Office of Labor Standards (OLS), delivery companies DoorDash and Postmates are now paying out more than $350,000 in restitution to drivers after Seattle’s hazard pay mandate went into effect this summer. DoorDash paid $111,435 to 2,998 workers in Seattle, while Postmates paid $250,515 to 2,975 workers.
In June, Seattle lawmakers passed a piece of legislation known as the “premium pay” bill intended to help gig workers receive extra money as economic protection during the COVID-19 pandemic. In what’s essentially hazard pay, drivers for food app delivery services such as DoorDash, Postmates, and Grubhub are supposed to get an extra $2.50 per order in addition to their usual pay. The bill requires companies to give these workers the extra money until the end of the city’s civil emergency, and penalties for noncompliance can range up to $546.07 per “aggrieved party” for a first offense, with that max going up on subsequent offenses.
In the case of the recent financial restitution from DoorDash and Postmates, the payments were not penalties or fines, but rather part of an agreement made between OLS and the two companies after drivers gave the Seattle department a heads-up about possible noncompliance with the newly enacted mandate.
“After receiving calls from gig workers, OLS contacted the companies, informing them that if the companies resolved issues regarding premium pay and paid workers back pay and interest by a certain date, OLS would forego a formal investigation,” OLS communications manager Cynthia Santana tells Eater Seattle. “Both companies complied, conducted an internal audit, which identified various problems, and promptly paid the workers back pay and interest. We received proof of compliance from both hiring entities.”
Third-party companies pushed back aggressively against Seattle’s hazard pay bill. The extra pay per delivery was intended to be $5, not $2.50, and would have included ride hailing services such as Uber and Lyft. But the number was reduced after negotiations among city lawmakers, third-party delivery services, and the labor organization Working Washington. Ride hailing apps were excluded because Mayor Jenny Durkan is currently working with those companies on more permanent pay minimums.
In a statement back in June, a rep for DoorDash said the Seattle law would “reduce earning opportunities [for drivers] and hurt restaurants at the worst possible time.” Around the same time, Instacart had threatened to abandon the Seattle market if the hazard pay bill passed (three months later, the app is still available here).
Eater Seattle reached out to both DoorDash and Postmates for comment on the recent payments and internal audit, but did not hear back before this article was published.
- Seattle Office of Labor Standards [Official Twitter]
- Seattle City Council Passes Bill That Secures Hazard Pay for Food Delivery App Drivers [ESEA]