SAN FRANCISCO—On Tuesday, June 16, San Francisco District Attorney Chesa Boudin announced the filing of an employee protection action lawsuit against DoorDash, an American food delivery service company with headquarters in San Francisco. The lawsuit alleges that DoorDash illegally misclassifies its delivery workers as independent contractors “when, in fact, they are employees,” Boudin stated in a press release.
DoorDash Inc. was founded in 2013 by four students at Stanford University in California: Tony Xu, Andy Fang, Stanley Tang, and Evan Moore. The company is currently valued at approximately $13 billion and is the largest third-party food delivery app in the United States. DoorDash refers to its delivery drivers as “dashers” and hires them to pick up orders made through the app and deliver them to customers.
DoorDash drivers are considered independent contractors by the company. According to the Internal Revenue Service, an individual is an independent contractor “if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done.”
Under California Assembly Bill 5, in order for companies like DoorDash to classify their workers as independent contractors, they must meet three criteria. First, that the worker is free from the control and direction of the hirer in connection with the performance of the work. Second, that the worker performs work that is outside the usual course of the hiring entity’s business. Third, that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.
The complaint filed by District Attorey Boudin against DoorDash alleges that the company cannot show that their delivery drivers meet all three criteria in order to be classified as independent contractors and that they are being illegally misclassified.
“Today’s action seeks to disrupt the essential services Dashers provide,” DoorDash Global Head of Public Policy Max Rettig said in a statement. “We will fight to continue providing Dashers the flexible earning opportunities they say they want in these challenging times.”
For more information, read the official complaint here.
