Oops! DoorDash CEO suggests the company pays the equivalent of less than $6/hour
Check this out— DoorDash sent an email to drivers where they acknowledge they are scrambling because “there has been a lot of discussion in the media” about their pay model… and in response they’re launching surveys & round tables.
They also claim that workers in the US averaged “more than $17.50 per hour on a delivery” last year. Even if that $17.50 figure is accurate, it works out to less than $6/hour after backing out tips and accounting for the cost of mileage, contractors’ additional payroll taxes, and other expenses.
Here’s how the math breaks down. Based on the pay data we’ve seen, a very conservative estimate would be at least about 30% of total income comes from tips. That means that $17.50 in income is only about $12.25 of pay — before mileage.
Another conservative estimate would be that an hour of delivery requires at least about 10 miles driven. Ten miles of driving at IRS rate of 58¢/mile is $5.80 in expenses for that hour — so we’re now at $6.45/hour in equivalent hourly pay. Contractors have to pay additional payroll taxes (7.65%), so that takes it down below $6 — we’re now at $5.96/hour in actual hourly pay, after accounting minimally for expenses.
This is according to DoorDash’s own figures.
Also worth mentioning…
The subject line is “Listening to the Dasher community” and the reply address is firstname.lastname@example.org