11 ms·

DoorDash Changes Tipping Model After Uproar

196 points by mcgwiz 7y ago

koolba 7y ago
> “Going forward,” DoorDash’s chief executive, Tony Xu, wrote on Twitter on Tuesday night, “we’re changing our model — the new model will ensure that Dashers’ earnings will increase by the exact amount a customer tips on every order. We’ll have specific details in the coming days.” > Under the policy, which the company adopted in 2017, DoorDash would offer a Dasher a guaranteed minimum amount to do a delivery. If a customer tipped, in most cases a tip paid through the app would go to subsidizing DoorDash’s contribution toward the guarantee, rather than increasing the Dasher’s pay. > For example, if DoorDash guaranteed a worker $7 for a delivery and a customer did not tip, DoorDash would directly pay the worker $7. If the customer tipped $3 via the app, DoorDash would directly pay the worker only $4, then add on the $3 tip so that the worker would still get only $7. And this is one more reason why I have and will not ever leave a digital tip. Yes I know how tipping aggregates for wait staff (and I think that’s stupid...) but this is different. These are independent contractors paid to do a job. If they agree to do it for $X then that should come out of the pocket of the company hiring them. Any tip is over the top. I hope they (DoorDash) get sued by their customers for deception, lose in court, and a precedent gets set to end this nonsense.
- dawnerd 7y ago
  > Yes I know how tipping aggregates for wait staff Quite a few states require wait staff/others to be paid the full minimum wage before tips: https://www.dol.gov/whd/state/tipped.htm https://www.dol.gov/whd/state/tipped.htm
- paulgb 7y ago
  > I hope they (DoorDash) get sued by their customers for deception, lose in court, and a precedent gets set to end this nonsense. Unfortunately, this will never happen, because their terms of service includes a binding arbitration clause. (Some of us noticed in time to opt out, but surely not the critical mass needed for a class action.)
  - User23 7y ago
    On the other hand it might be straight up wage theft, which is a criminal matter. Californian drivers should file a claim with the Department of Industrial Relations: https://www.dir.ca.gov/dlse/howtofilewageclaim.htm https://www.dir.ca.gov/dlse/howtofilewageclaim.htm
  - elliekelly 7y ago
    If you managed to opt out then find an attorney to file a class action. Force DoorDash to make the case that you don’t have enough people to get the class certified, don’t do the hard part for them by just assuming it.
- ben_jones 7y ago
  Postmates opens a tipping modal after a delivery that CANNOT BE CLOSED without inputting a tip and clicking submit. You literally have to type 0.00 and click submit to continue to use the app. I grew up in a strong tipping household (both parents worked service jobs) and usually tip very highly, but everyone should have the right not to tip if they don't want to (with no shaming or prodding) and companies should not subsidize their operational costs by dark patterning customers into tipping.... grr. At the same time I hypocritically am a power user of many "gig economy" apps like uber, ubereats, postmates, etc. so I am contributing to the problem more than most.
  - rhino369 7y ago
    I don't mind tipping, but if I'm paying the delivery guy myself, then what the hell is postmates charging me a delivery fee for? I have no idea what I'm paying for and who gets what. It's confusing. So i've been just tipping 3 bucks.
  - altmind 7y ago
    and lyft tipping dialog does not allow to enter fraction of a dollar. that's all pretty annoying when you have specific rule to tip specific % of the bill and can not do that.
  - forgtpasswd 7y ago
    I simply don't understand tipping before service. I have had multiple occasions where the delivery is either delayed, food items missing, delivery guy calling me and asking me to walk up to him/her because he/she doesn't want to deal with parking etc. But, still expected norm is to pay a tip in advance and hope for good service. And, in case you had a bad experience, well you rewarded the service with a tip in advance anyway.
    - TheAceOfHearts 7y ago
      It's been a while since I last used their service, but I think they allow you to modify your tip after the delivery has been made.
- jessriedel 7y ago
  I don't know how what the actual agreement was, but couldn't this be very reasonably structured as a form of insurance/derivative? Like, if I'm a pizza delivery guy, I have some expected stream of tips with a variance. If the total tips I receive in a year is usually in the range $300 - $1000, it may be that I'd much rather have a guaranteed $500 than take the risk, so I might buy insurance from a 3rd party (doesn't have to be my employer), who pays me $500 in exchange for the rights to my tips. This doesn't seem immoral/deceptive to me, and is probably financial equivalent to the DoorDash model.
  - maxerickson 7y ago
    Depends on whether the delivery person has access to the information about the tips and whether they can opt out. If they don't see the different payouts that come with different customer tips and they can't opt out, it's not very equivalent.
    - jessriedel 7y ago
      I agree this is potentially relevant, thanks!
    - thaumasiotes 7y ago
      Why does it depend on whether the delivery person can opt out of tip-sharing? Those are contractual terms just like any other contractual terms.
      - maxerickson 7y ago
        It matters for the comparison to a financial product. It if is a mandatory term of employment, it isn't comparable to a financial product.
- sbr464 7y ago
  Just a nit, I’m curious how they can guarantee full payout ($7/$7) without mentioning merchant processing fees? Does the company pay those or is it implied that $7 on full payout would actually be $6.80 after fees? I couldn’t see it being sustainable to absorb the extra fee, but if it is withheld, it seems misleading to not mention it. (Technically, this question could apply to the tipping industry as a whole)
  - snuxoll 7y ago
    DoorDash has surcharges on top of surcharges to cover their costs, and frequently mark up menu price as well. They can eat $0.20.
    - asark 7y ago
      I received some huge % off an order from them, recently, and tried the service for the first and last time. I had to hunt to find a place to order from that wasn't absurdly expensive even with the discount. Menu prices were significantly higher than real menu prices in most cases, hiding the actual cost of the service, which did have a fee on top of that, and making it so instead of the delivery cost kinda flattening out the more you order like it does with, say, normal pizza delivery, it got higher and higher the more you ordered.
      - deleted 7y ago
        [deleted]
bluetidepro 7y ago
It's interesting to see the new uproar about this change over on r/DoorDash. It's interesting to see a lot of the workers now worried this will actually end up being even less. It seems like they (workers/drivers) got what they wanted, but also didn't.
- lovehashbrowns 7y ago
  Thank you for pointing that out. It was an interesting read. It seems like most of them blame the customers that didn't want to be deceived rather than the company itself and their shitty practices.
- amyjess 7y ago
  My observation about /r/DoorDash is that nobody there is ever happy. I first checked it out in 2017, shortly after they implemented the current model. The entire subreddit was a massive open revolt of people complaining that they simply can't survive on what the new model pays them. For the record, I went there because I got curious after I had a string of several dashers who were just awful and couldn't follow basic directions. The impression I got is that everyone on the platform with any intelligence either had quit over the changes or was threatening to, leaving only the people who just don't have the skills to get work anywhere else. I'd look at it every few months or so after that, and one thing pretty common was that people were suggesting that nobody should tip in the app and that everyone should leave a cash tip because DoorDash steals tips. When the tipping scandal first hit the news (forcing Instacart to change their policies), I checked it out again, and everyone was talking about how finally the media is calling attention to how awful the tipping situation is and again suggesting that nobody ever tip in the app. And now this. DoorDash is fixing this policy, and the people there are still upset. /r/DoorDash is simply the single unhappiest subreddit I've ever seen that isn't a politics sub or a straight-up hate sub. My impression using DoorDash, by the way, is that the situation I mentioned above never resolved itself. I have a tendency to use DoorDash because DashPass actually saves me a lot of money (you pay $10/month and get most of your fees taken off on each order above $15... it usually saves me about $5/order, so it pays for itself after two orders a month), but dealing with the drivers is such a colossal headache that ordering something on DoorDash stresses me out each time. I have never had anywhere near the level of problems with drivers on Uber Eats or GrubHub (or Eat24 before them; I still miss that company) that I have with dashers. DoorDash treats its people so poorly that all the good dashers have long since quit, leaving only people who have a marked inability to follow basic directions or instructions. I've found myself ordering from Uber Eats more and more lately, even though I'm paying more, just because the quality of the drivers is so much higher.
gringoDan 7y ago
This doesn't change anything. DoorDash will lower the base pay of the orders, meaning the total compensation for Dashers will remain the same. DoorDash has a model for what it considers "fair compensation" for an order. Since the company can see exactly what the customers tip in advance, they'll just subtract the tip amount from their previously calculated "fair compensation" and show that base pay / tip breakdown to the Dashers. DoorDash isn't going to suddenly increase its Dashers' pay by 50%. If you want to actually compensate the Dashers, tip $0 in the app (raising base pay) and hand them cash at the door. That seems to be the only way to get around this policy.
- jakelazaroff 7y ago
  Wouldn't that be easy to discover using the same method the NYT used to find this in the first place [1]? > DoorDash offers a guaranteed minimum for each job. For my first order, the guarantee was $6.85 and the customer, a woman in Boerum Hill who answered the door in a colorful bathrobe, tipped $3 via the app. But I still received only $6.85. > Here’s how it works: If the woman in the bathrobe had tipped zero, DoorDash would have paid me the whole $6.85. Because she tipped $3, DoorDash kicked in only $3.85. She was saving DoorDash $3, not tipping me. [1] https://www.nytimes.com/2019/07/21/nyregion/doordash-ubereats-food-app-delivery-bike.html https://www.nytimes.com/2019/07/21/nyregion/doordash-ubereat...
  - gringoDan 7y ago
    In that case, DoorDash will guarantee $3.85, knowing full well you'll make $6.85 for the order. Edit - I'd expect they'll show something like the below Total pay: $6.85 Guaranteed base pay: $3.85 Tip: $3.00
  - unreal37 7y ago
    But that's OK. They should lower the amount that they offer for a delivery to not include the tip. And then drivers will refuse to work for them and they'll be forced to increase it. Supply and demand.
    - 7y ago
orvtech 7y ago
I'll keep tipping in cash, thank you.
guelo 7y ago
I was amazed a few months ago when Instacart managed the uproar over this same practice and DoorDash apparently calculated that Instacart would take the brunt of the outrage and they would be able to keep their heads down and let it blow over without making any changes. That was stupid and it was only a matter of time before the next reporter noticed it and it would blow up again. The correct evil strategy seems to be what Instacart is doing now which is to make a complicated algorithm so opaque that nobody understands it so it's difficult for it to generate outrage.
- CodeWriter23 7y ago
  With the slippery language about the "model" and the future disclosure of said model, I think DoorDash will do something like you describe. Because it takes fewer words to say "Going forward all Dasher's will earn the guaranteed rate plus any tips".
tolstoshev 7y ago
Glad they changed it, but it's pretty damning that this was the model in the first place.
minikites 7y ago
Wage theft is distressingly common. The biggest thieves are businesses (stealing from workers) and not some cat-burglar in a striped shirt: https://preview.redd.it/grnr8kxbl6zz.jpg?width=960&crop=smart&auto=webp&s=58e55a49de73f58ebd92aed4472b10d525627262 https://preview.redd.it/grnr8kxbl6zz.jpg?width=960&crop=smar... https://www.epi.org/publication/employers-steal-billions-from-workers-paychecks-each-year-survey-data-show-millions-of-workers-are-paid-less-than-the-minimum-wage-at-significant-cost-to-taxpayers-and-state-economies/ https://www.epi.org/publication/employers-steal-billions-fro... https://www.currentaffairs.org/2017/11/abuse-by-bosses-comes-in-many-forms https://www.currentaffairs.org/2017/11/abuse-by-bosses-comes... This is why unions and collective bargaining are so important. The power of an individual is almost meaningless versus a business of any size.
- overthemoon 7y ago
  Yes. For every company shamed into sorta kinda doing the right thing, there are so many other less sexy and high profile companies doing the exact same thing. Unions are not perfect, but they're better than nothing.
- unreal37 7y ago
  Unions are not better. This isn't 1888 any more. They charge the employees a fee every paycheck, but when you need them, they'll do what's in their best interest not yours. As a teen, I was forced to quit a job (with my union rep beside me) for a made up reason. "Better to quit than to be fired" was his advice. Obviously my "quitting" was part of some bigger plan to save a job of his friend or some other concession the boss made to him. Unions protect the employees as a whole but not the individuals. They have their own interests that are not always aligned with the employees either.
- thrwwy987 7y ago
  Perhaps what this article talks about should be reframed as actual (literal) theft, like the way a burglar or pickpocket does: same as if an employer broke into your home, found your wallet, and removed $20 from it that a customer had literally handed to you as their gift to you. Literal burglary/theft/etc. That would frame it in a way that doesn't somehow legitimize it, and would make employers seem, and be, far more criminal after they decide to reach into someone's pocket and steal cash.
imgabe 7y ago
Tipping just needs to die. If your business model demands that customers pay your price + 20% to pay your employees a wage they'll accept, then just increase your price by 20% and pay your employees that wage to begin with. Don't lie to customers and tell them the price is 20% lower than it really is when they're expected to add on more.
- draw_down 7y ago
  I love when these stories pop up because I get to see HNers grind their axe against the general practice of tipping. You all never disappoint!
- Phobophobia 7y ago
  I generally concur. Living in Japan for a month, attending budget and 5-star accommodations and dining, it was very streamlined to have minimal tipping expected [or unexpected].
  - s_y_n_t_a_x 7y ago
    I've lived in Japan, and you notice the lack of tipping culture. Service is a lot worse. Go to any restaurant, you won't get service, refills etc. You have to yell or get it yourself. That's what the service would be like without tips. Servers have no incentive to take care of your table if they get paid the same either way. I'm fine with that system, as long as it's setup that way. Give me a way to refill my drink etc. But sometimes it's setup where they have to do it, and you're either waiting an hour for a drink or a check.
    - asark 7y ago
      Other countries don't have the same notion of what good service is, and don't expect the server to be up your ass about drink refills every 30s to count as good service. They expect you to ask if you need something, so they're not bugging you. It's just a difference in what's considered better. You see the other style at finer (expensive) restaurants in the US, sometimes. It's really nice to be able to chat with your fellow diners without some stranger constantly bugging you while being pretend-nice.
lancesells 7y ago
Amazon Primenow unfortunately does the same thing. I wish that would become a story as well.
- miaklesp 7y ago
  Just set tip to 0 every time.
  - Pfhreak 7y ago
    And tip in cash.
  - lancesells 7y ago
    While that works for me I'm guessing 95% of the people using Primenow don't know to do that. Amazon is 100x larger than DoorDash and needs to be called out on it.
unreal37 7y ago
I think North America really needs to re-evaluate this concept of tips. The rules of what to tip and when are intentionally vague because it's a sensitive subject. We should move to "fair pay", that includes slightly increased prices, and do away with tips for most services. It's so common that tips don't mean what the consumer thinks it means. Restaurants and bars that pool tips and share them with all staff.[1] Restaurant owners that try to keep some tips and only pay out a percentage to the staff.[2] Casinos pool tips too so the dealer doesn't get to keep the money you gave him directly.[3] I get asked for tips at Starbucks. I get asked for tips when I do takeout food from the local restaurant. I get asked for tips at the buffet restaurant. The pizza driver gets a delivery charge AND a tip! Let's clean it up and make it fair for the servers and the consumers. [1] https://www.restaurantscanada.org/industry-news/aware-ontarios-tip-pooling-rules-regulations/ https://www.restaurantscanada.org/industry-news/aware-ontari... [2] https://www.restaurantbusinessonline.com/advice-guy/can-restaurant-owners-share-tip-pool https://www.restaurantbusinessonline.com/advice-guy/can-rest... [3] https://www.businessinsider.com/wynn-tip-sharing-2011-6 https://www.businessinsider.com/wynn-tip-sharing-2011-6
- alteria 7y ago
  The usual explanation for tipping is that the minimum wage for tipped employees is lower than the non-tipped minimum wage (sometimes as low as $2.13). If you knew everyone was getting paid the minimum wage, would you still tip on a regular basis? I recently learned that in states like Washington, California, Oregon this is the case [1], and have been tipping less as a result, but still feel slightly bad about it (societal conditioning is strong!). [1]https://www.minimum-wage.org/tipped https://www.minimum-wage.org/tipped
  - rhino369 7y ago
    >The usual explanation for tipping is that the minimum wage for tipped employees is lower than the non-tipped minimum wage (sometimes as low as $2.13). People get the cause and effect backwards on that. The minimum wage is lower because lawmakers knew they were already getting compensated by tips. It's a social custom, not charity.
  - 7y ago
radcon 7y ago
I can't believe that was legal. They basically tricked consumers into giving them millions of dollars. If the app called it a "Tip" then that should be some kind of fraud because it wasn't a tip in the way that any reasonable person would assume, it was a donation to the company.
kevinventullo 7y ago
I stopped using DoorDash a few years ago after reading about this. Despicable.
sambroner 7y ago
I'm regularly confused by tipping. I was never confused by tipping until the gig economy. There's a tip on almost all of the gig services I use now, with zero explanation of how the tip affects the gig worker. The tip should be a reflection of the workers contribution to the service. I probably won't ever tip a company. DoorDash has raised $2Bil from investors. They're using this money, presumably, to attract customers and suppliers through advertising and low pricing. DoorDash is one of many companies using VC money in this way. Now I'm supposed to subsidize the VC's subsidy of the product?
- TeMPOraL 7y ago
  After the previous tipping drama (Instacart?), and little earlier my discovery that a tip in a hotel restaurant actually doesn't go to waiters, but its taken by the owner, I started to ask workers whether or not they receive the tip in full. So e.g. now I happily tip FreeNow (née MyTaxi) drivers, having two of them confirm to me that they pocket entirety of the tip.
nafizh 7y ago
Starup industry's break fast motto has become more like break every kind of decency these days.
Dirlewanger 7y ago
If we had a populace educated in basic personal finance, the gig economy would not exist.
- notJim 7y ago
  I don't see how? It seems like the gig economy is essentially profiting from the fact that there are a lot more workers available than decent jobs. How would personal finance education change that situation?
souterrain 7y ago
Wage theft is theft. DoorDash, and the VCs backing them, should be treated as thieves until such time as they unequivocally reject the practice of wage theft in all of their business dealings.
neilv 7y ago
I thought management taking a cut of tips was known in the American restaurant/takeout industry to be illegal. And at least one other prominent dotcom has already been called on this. Is this yet another instance of a dotcom knowingly and blatantly ignoring existing laws and regulations, and seeing how much they can get away with, while they use this advantage to steam full-ahead towards market dominance and IPO? Is DoorDash yet influential enough that they can turn this into merely a regulatory handslap/caress?
ycombonator 7y ago
They misrepresented the tip charges to the customers. Where is FTC ? and why isn't there an investigation ?
malandrew 7y ago
Moral of the story is to never use DoorDash at least not until they pay back all those drivers the tips they stole.
parliament32 7y ago
My biggest gripe with tipping culture right now is the number of services and establishments that think it's okay to tip ahead of time. If I sit down at a restaurant, and get served well, I'll leave a tip at the end when I pay. Hell, even if the service isn't great I'll still leave a bit of a tip. But now there's this idea that you should tip for service... before you get served. The tip jars at Starbucks, apps that ask you to input your tip before you get your delivery, POS systems that ask for a tip, etc. There's no way I'll ever tip before service, and probably won't after either if the business is audacious enough to ask for a tip when they're using a pay-before business model. I'm looking forward to seeing how long it takes for self-service gas pumps to start asking for tips. After all, there's an attendant inside keeping an eye on you, so that's a service right?
- charliesharding 7y ago
  I agree - I think it's an absolute misunderstanding of what a tip means. It completely removes incentive for the dasher to follow delivery instructions, grab extra napkins, ensure food is stored upright, etc. I would be so much more on board with agreeing to a set tip amount beforehand if I don't manually enter one after the food was delivered after x amount of time..
- umvi 7y ago
  This is so annoying! It's like an automatic thing now when paying in a trendy store using an iPad. It's like, I just ordered, but before I've even gotten my goods, I'm presented with a dialogue on whether I want to pay 5%, 10%, 15% tip (or "no tip" as a small button at the bottom). I'm sure these businesses have found that merely including the dialogue = free money, so why wouldn't they?
  - neura 7y ago
    I've had several experiences lately where the tip dialog only offered 15/20/25% or "other" (which could be used as "none")
    - FireBeyond 7y ago
tareqak 7y ago
DoorDash (YC s2013) [0]. [0] https://www.ycombinator.com/companies/ https://www.ycombinator.com/companies/ (search for DoorDash)
EGreg 7y ago
Hey all. Can someone explain to me WHY in 2019 we still tie the infrastructure to the power to make decisions? Marketplaces are built not on open protocols (like email) but closed platforms. They amass people from both sides and extract rents. But that’s a side effect of the closed nature of the software. Why yell at doordash or uber or facebook to add a feature? Why does country X go after them for deleting posts while country Y yells that they didn’t delete similar posts? Closed software is the issue. “Zero to one. Competition is for losers” is who funded Facebook. If people wanted to add tips in Wordpress or Email or whatever, they could just go ahead an add those. Or a million other features. Their clients would still interoperate. Main reason: the capitalistic system we have encourages getting very wealthy as a result of building a successful company. It encourages people to work extremely hard and take risks while competing and duplicating 90% of the work others are doing. But in the area of software and information, copying is so easy. Collaboration beats competition nearly every time, relegating the proprietary solutions of yesteryear to obsolescence. The private market is reduced to turning out brief “bleeding edge” innovations which are then subsumed into the open source snowball. Wikipedia, the Web, Webkit, Wordpress, MySQL and NGinX has beat Britannica, AOL, Blogger.com, IE, Oracle and IIS. So why don’t we have more of it in other areas? Drugs? Marketplaces? Albert Wenger from USV has a nice online book called “World after Capital” that speaks about this.
elicash 7y ago
DoorDash CEO: "our average contribution to Dashers stayed the same" What weird, coded language. They're not "paying employees." They're "contributing" to "Dashers." At first, I figured this was just a way to avoid saying that they're independent contractors, but this seems even more vague than THAT. Why, legally, would they say "contributions" rather than "pay?" It seems like there's a different distinction from the independent contractor one.
- somebodythere 7y ago
  Because. DoorDash would not like you to think it's that you paying DoorDash and DoorDash paying Dashers. That would, in fact, make them independent contractors. Instead, DoorDash would like you to think that you are paying the Dasher directly. DoorDash provided you a platform to find a Dasher and enter into a delivery agreement with them. And DoorDash is graciously "contributing" to the Dasher's income. This would make them no more an independent contractor than someone looking for work on Craigslist. I don't think this holds up because DoorDash is custodial of the money before it reaches the Dasher's wallet, and because from the customer's perspective, they're ordering delivery from DoorDash, not a Dasher. But that's just my idle speculation.
  - scrollaway 7y ago
    How is what you're describing different than a freelancing platform like upwork? I'm sure the service terms are different but in upwork's case, they're also acting as the escrow and taking a cut.
40acres 7y ago
I think tipping is ingrained in American culture because of the lack of price transparency throughout this economy. This has been a recent topic of discussion in regards to healthcare but it also shows up in retail, where the shelf price is not reflective of sales taxes, and when booking services like flights and hotels where "resort fees" and "baggage fees" rear their ugly head last minute. I've even seen "no tipping" restaurants do the same with a fine print saying that a 15-18% gratuity will be charged on top of my order, well.. why aren't all the dishes simply 15-18% more expensive then?
- iguy 7y ago
  When I'm king this will count as false advertising. The biggest printed price must be the price you pay, by default, unless you specifically ask for something unusual.
- 121789 7y ago
  I don't think that's the problem. I'm American and I'll generalize a bit and say Americans are generally comfortable with tipping as long as the service is a differentiator for what you receive (full service restaurants, hair stylists, drivers, bartenders). The recent frustration has been the explosion of tipping where service has nothing to do with the experience, like fast food restaurants or low cost coffee shops.
  - throwtipaway 7y ago
    No we are not comfortable with tipping. Many people like me do not tip even though we get weird looks or the occasional angry waiter.
    - tyrust 7y ago
      Even if you aren't comfortable with it you ought to do it in America. Your protest only hurts the underpaid laborer.
      - lh7777 7y ago
miaklesp 7y ago
I never pay any tips except in restaurants. I always set tip to 0 in Prime Now etc. I makes me feel good that I can spend the saved money on myself.
rconti 7y ago
There was a really easy fix for this. Remove the message that says "100% of your tip goes to your Dasher". Stop lying to the customer. It's that simple! As usual, the reality of the financial situation is fairly complicated. Doordash guarantees minimums that other such services do not. In other words, in many ways, Doordash was more friendly to their 'contractors' than other services. If they had simply chosen not to be unethical and lie to customers about where their tips go, they could have had it both ways.
- FireBeyond 7y ago
  Their argument was that it's not a lie. The entirety of your tip _does_ go to the Dasher. ... it's just that they reduce _their_ fee paid to them by, coincidentally, the same amount. And claim that this offers the Dasher "stability".
minikites 7y ago
Many people want to keep the very concept and system of tips in place because it affords them power over someone: https://theoutline.com/post/4602/the-restaurant-industry-is-fighting-like-hell-against-raising-the-tipped-minimum-wage https://theoutline.com/post/4602/the-restaurant-industry-is-... >“Money is power,” said Brooklyn-based waitress Marisa Licandro. “If the customer is paying my wage, they have power over me. And customers having power over you means that you can’t speak against them when they try to grab you. https://www.nytimes.com/interactive/2018/03/11/business/tipping-sexual-harassment.html https://www.nytimes.com/interactive/2018/03/11/business/tipp... >There was the waitress in Portland, Ore., Whitney Edmunds, who swallowed her anger when a man patted his lap and beckoned her to sit, saying, “I’m a great tipper.” https://jezebel.com/what-does-tipping-have-to-do-with-sex-and-power-1156118970 https://jezebel.com/what-does-tipping-have-to-do-with-sex-an... >And his go-to line was so predictable, we would wait for it, anticipate it. “I always tip way more than twenty percent!” >If that was the case, why were these guys so mad about paying only 18%, far less than they otherwise would? What was it about not choosing the amount they tipped, that infuriated them, even when they were getting a discount? >It had to be at least partially about lack of control. Or, more accurately, lack of imagined control. This guy thought that, in a tipped environment, his server would perform better in order to get more of his money. That idea is false, as shown both by repeated studies and common sense, but that was irrelevant. His anger could not be redeemed by mere facts.
GigLoL 7y ago
The "gig economy" is designed for the idiots on both sides. The idiots that use these services. The idiots that "work" for these services. Can't wait until it all goes away.
johnwheeler 7y ago
Doordash is so stupid. I should be able to tip after I get my order, not before. Until they fix that, the model is backwards and broken for the consumer
- oiasdjfoiasd 7y ago
  yeah, lol. once you do it once, you'll never do it again. Add tip. Delivery driver fucks up the order/super late/spills your drink. Too late! already tipped.
pacetherace 7y ago
Tipping model is at its tipping point. It is high time US citizens stop tipping and make businesses realize that the customers are not directly responsible for employee wages.
- cameronbrown 7y ago
  Devil's Advocate: Many people in the hospitality industry are making far more via tips than they'd receive from a market wage.
  - dajohnson89 7y ago
    many people are also NOT making what they could be making, if paid a fair wage. At the very least, they're subject to an insane amount of income insecurity. If a bartender at a sluggish restaurant is scheduled monday-wednesday, instead of his usual fri-sunday, he's probably screwed and making a fraction of what he normally does.
    - walru 7y ago
      True, but at the same time not every bartender makes a great cocktail, or cares to. If people want service levels to race to the bottom this is the way to do it. The main problem with the DD model is that they're asking people to decide a tip before being provided a service. That's unfair to the customer and driver. As far as paying a decent wage before that, DD could provide a mile cost reimbursement as well as one for the time spent on the order. Paying the driver a blanket fee for every order they deliver rather than one based on time and millage is not sustainable. I understand that's much how the model used to work, but the whole thing about tip culture is rewarding people who do the little things to make the experience worth it for you having to pay extra. As a customer of DD you're only going to be aware of things after you've received your food. Also, if a bartender is not getting the best shifts, that may be because the bar cycles their shifts or they aren't as good, or maybe Wednesday is a busier night and they only staff one bartender so that person may end up doing better than having to split a bar with several others. That said, if it's busier on a Saturday and the bartenders are getting hammered, why should they have to subsidize the bartender who isn't there?
thallavajhula 7y ago
This is great. But, I got excited thinking that DoorDash changed their tipping UX by allowing users to tip after the service is rendered.
- robocat 7y ago
  Can't you tip with cash?
larrybud 7y ago
It seems like the simple answer to this is to tip out-of-band directly to the person (e.g, cash, venmo, etc).
g9yuayon 7y ago
I feel sick to my stomach. I give tips specifically to the drivers, yet those companies took a cut without even telling the drivers. A so-called high-tech company behaves like a rogue restaurant owner. How low can we go?
jdkee 7y ago
Solution: tip in cash.

196 points by mcgwiz 7y ago

> “Going forward,” DoorDash’s chief executive, Tony Xu, wrote on Twitter on Tuesday night, “we’re changing our model — the new model will ensure that Dashers’ earnings will increase by the exact amount a customer tips on every order. We’ll have specific details in the coming days.” > Under the policy, which the company adopted in 2017, DoorDash would offer a Dasher a guaranteed minimum amount to do a delivery. If a customer tipped, in most cases a tip paid through the app would go to subsidizing DoorDash’s contribution toward the guarantee, rather than increasing the Dasher’s pay. > For example, if DoorDash guaranteed a worker $7 for a delivery and a customer did not tip, DoorDash would directly pay the worker $7. If the customer tipped $3 via the app, DoorDash would directly pay the worker only $4, then add on the $3 tip so that the worker would still get only $7. And this is one more reason why I have and will not ever leave a digital tip. Yes I know how tipping aggregates for wait staff (and I think that’s stupid...) but this is different. These are independent contractors paid to do a job. If they agree to do it for $X then that should come out of the pocket of the company hiring them. Any tip is over the top. I hope they (DoorDash) get sued by their customers for deception, lose in court, and a precedent gets set to end this nonsense.

dawnerd 7y ago
> Yes I know how tipping aggregates for wait staff Quite a few states require wait staff/others to be paid the full minimum wage before tips: https://www.dol.gov/whd/state/tipped.htm https://www.dol.gov/whd/state/tipped.htm
paulgb 7y ago
> I hope they (DoorDash) get sued by their customers for deception, lose in court, and a precedent gets set to end this nonsense. Unfortunately, this will never happen, because their terms of service includes a binding arbitration clause. (Some of us noticed in time to opt out, but surely not the critical mass needed for a class action.)
- User23 7y ago
  On the other hand it might be straight up wage theft, which is a criminal matter. Californian drivers should file a claim with the Department of Industrial Relations: https://www.dir.ca.gov/dlse/howtofilewageclaim.htm https://www.dir.ca.gov/dlse/howtofilewageclaim.htm
- elliekelly 7y ago
  If you managed to opt out then find an attorney to file a class action. Force DoorDash to make the case that you don’t have enough people to get the class certified, don’t do the hard part for them by just assuming it.
ben_jones 7y ago
Postmates opens a tipping modal after a delivery that CANNOT BE CLOSED without inputting a tip and clicking submit. You literally have to type 0.00 and click submit to continue to use the app. I grew up in a strong tipping household (both parents worked service jobs) and usually tip very highly, but everyone should have the right not to tip if they don't want to (with no shaming or prodding) and companies should not subsidize their operational costs by dark patterning customers into tipping.... grr. At the same time I hypocritically am a power user of many "gig economy" apps like uber, ubereats, postmates, etc. so I am contributing to the problem more than most.
- rhino369 7y ago
  I don't mind tipping, but if I'm paying the delivery guy myself, then what the hell is postmates charging me a delivery fee for? I have no idea what I'm paying for and who gets what. It's confusing. So i've been just tipping 3 bucks.
- altmind 7y ago
  and lyft tipping dialog does not allow to enter fraction of a dollar. that's all pretty annoying when you have specific rule to tip specific % of the bill and can not do that.
- forgtpasswd 7y ago
  I simply don't understand tipping before service. I have had multiple occasions where the delivery is either delayed, food items missing, delivery guy calling me and asking me to walk up to him/her because he/she doesn't want to deal with parking etc. But, still expected norm is to pay a tip in advance and hope for good service. And, in case you had a bad experience, well you rewarded the service with a tip in advance anyway.
  - TheAceOfHearts 7y ago
    It's been a while since I last used their service, but I think they allow you to modify your tip after the delivery has been made.
jessriedel 7y ago
I don't know how what the actual agreement was, but couldn't this be very reasonably structured as a form of insurance/derivative? Like, if I'm a pizza delivery guy, I have some expected stream of tips with a variance. If the total tips I receive in a year is usually in the range $300 - $1000, it may be that I'd much rather have a guaranteed $500 than take the risk, so I might buy insurance from a 3rd party (doesn't have to be my employer), who pays me $500 in exchange for the rights to my tips. This doesn't seem immoral/deceptive to me, and is probably financial equivalent to the DoorDash model.
- maxerickson 7y ago
  Depends on whether the delivery person has access to the information about the tips and whether they can opt out. If they don't see the different payouts that come with different customer tips and they can't opt out, it's not very equivalent.
  - jessriedel 7y ago
    I agree this is potentially relevant, thanks!
  - thaumasiotes 7y ago
    Why does it depend on whether the delivery person can opt out of tip-sharing? Those are contractual terms just like any other contractual terms.
    - maxerickson 7y ago
      It matters for the comparison to a financial product. It if is a mandatory term of employment, it isn't comparable to a financial product.
sbr464 7y ago
Just a nit, I’m curious how they can guarantee full payout ($7/$7) without mentioning merchant processing fees? Does the company pay those or is it implied that $7 on full payout would actually be $6.80 after fees? I couldn’t see it being sustainable to absorb the extra fee, but if it is withheld, it seems misleading to not mention it. (Technically, this question could apply to the tipping industry as a whole)
- snuxoll 7y ago
  DoorDash has surcharges on top of surcharges to cover their costs, and frequently mark up menu price as well. They can eat $0.20.
  - asark 7y ago
    I received some huge % off an order from them, recently, and tried the service for the first and last time. I had to hunt to find a place to order from that wasn't absurdly expensive even with the discount. Menu prices were significantly higher than real menu prices in most cases, hiding the actual cost of the service, which did have a fee on top of that, and making it so instead of the delivery cost kinda flattening out the more you order like it does with, say, normal pizza delivery, it got higher and higher the more you ordered.
    - deleted 7y ago
      [deleted]

bluetidepro 7y ago

It's interesting to see the new uproar about this change over on r/DoorDash. It's interesting to see a lot of the workers now worried this will actually end up being even less. It seems like they (workers/drivers) got what they wanted, but also didn't.

lovehashbrowns 7y ago
Thank you for pointing that out. It was an interesting read. It seems like most of them blame the customers that didn't want to be deceived rather than the company itself and their shitty practices.
amyjess 7y ago
My observation about /r/DoorDash is that nobody there is ever happy. I first checked it out in 2017, shortly after they implemented the current model. The entire subreddit was a massive open revolt of people complaining that they simply can't survive on what the new model pays them. For the record, I went there because I got curious after I had a string of several dashers who were just awful and couldn't follow basic directions. The impression I got is that everyone on the platform with any intelligence either had quit over the changes or was threatening to, leaving only the people who just don't have the skills to get work anywhere else. I'd look at it every few months or so after that, and one thing pretty common was that people were suggesting that nobody should tip in the app and that everyone should leave a cash tip because DoorDash steals tips. When the tipping scandal first hit the news (forcing Instacart to change their policies), I checked it out again, and everyone was talking about how finally the media is calling attention to how awful the tipping situation is and again suggesting that nobody ever tip in the app. And now this. DoorDash is fixing this policy, and the people there are still upset. /r/DoorDash is simply the single unhappiest subreddit I've ever seen that isn't a politics sub or a straight-up hate sub. My impression using DoorDash, by the way, is that the situation I mentioned above never resolved itself. I have a tendency to use DoorDash because DashPass actually saves me a lot of money (you pay $10/month and get most of your fees taken off on each order above $15... it usually saves me about $5/order, so it pays for itself after two orders a month), but dealing with the drivers is such a colossal headache that ordering something on DoorDash stresses me out each time. I have never had anywhere near the level of problems with drivers on Uber Eats or GrubHub (or Eat24 before them; I still miss that company) that I have with dashers. DoorDash treats its people so poorly that all the good dashers have long since quit, leaving only people who have a marked inability to follow basic directions or instructions. I've found myself ordering from Uber Eats more and more lately, even though I'm paying more, just because the quality of the drivers is so much higher.

gringoDan 7y ago

This doesn't change anything. DoorDash will lower the base pay of the orders, meaning the total compensation for Dashers will remain the same. DoorDash has a model for what it considers "fair compensation" for an order. Since the company can see exactly what the customers tip in advance, they'll just subtract the tip amount from their previously calculated "fair compensation" and show that base pay / tip breakdown to the Dashers. DoorDash isn't going to suddenly increase its Dashers' pay by 50%. If you want to actually compensate the Dashers, tip $0 in the app (raising base pay) and hand them cash at the door. That seems to be the only way to get around this policy.

jakelazaroff 7y ago
Wouldn't that be easy to discover using the same method the NYT used to find this in the first place [1]? > DoorDash offers a guaranteed minimum for each job. For my first order, the guarantee was $6.85 and the customer, a woman in Boerum Hill who answered the door in a colorful bathrobe, tipped $3 via the app. But I still received only $6.85. > Here’s how it works: If the woman in the bathrobe had tipped zero, DoorDash would have paid me the whole $6.85. Because she tipped $3, DoorDash kicked in only $3.85. She was saving DoorDash $3, not tipping me. [1] https://www.nytimes.com/2019/07/21/nyregion/doordash-ubereats-food-app-delivery-bike.html https://www.nytimes.com/2019/07/21/nyregion/doordash-ubereat...
- gringoDan 7y ago
  In that case, DoorDash will guarantee $3.85, knowing full well you'll make $6.85 for the order. Edit - I'd expect they'll show something like the below Total pay: $6.85 Guaranteed base pay: $3.85 Tip: $3.00
- unreal37 7y ago
  But that's OK. They should lower the amount that they offer for a delivery to not include the tip. And then drivers will refuse to work for them and they'll be forced to increase it. Supply and demand.
  - 7y ago

orvtech 7y ago

I'll keep tipping in cash, thank you.

guelo 7y ago

I was amazed a few months ago when Instacart managed the uproar over this same practice and DoorDash apparently calculated that Instacart would take the brunt of the outrage and they would be able to keep their heads down and let it blow over without making any changes. That was stupid and it was only a matter of time before the next reporter noticed it and it would blow up again. The correct evil strategy seems to be what Instacart is doing now which is to make a complicated algorithm so opaque that nobody understands it so it's difficult for it to generate outrage.

CodeWriter23 7y ago
With the slippery language about the "model" and the future disclosure of said model, I think DoorDash will do something like you describe. Because it takes fewer words to say "Going forward all Dasher's will earn the guaranteed rate plus any tips".

tolstoshev 7y ago

Glad they changed it, but it's pretty damning that this was the model in the first place.

minikites 7y ago

Wage theft is distressingly common. The biggest thieves are businesses (stealing from workers) and not some cat-burglar in a striped shirt: https://preview.redd.it/grnr8kxbl6zz.jpg?width=960&crop=smart&auto=webp&s=58e55a49de73f58ebd92aed4472b10d525627262 https://preview.redd.it/grnr8kxbl6zz.jpg?width=960&crop=smar... https://www.epi.org/publication/employers-steal-billions-from-workers-paychecks-each-year-survey-data-show-millions-of-workers-are-paid-less-than-the-minimum-wage-at-significant-cost-to-taxpayers-and-state-economies/ https://www.epi.org/publication/employers-steal-billions-fro... https://www.currentaffairs.org/2017/11/abuse-by-bosses-comes-in-many-forms https://www.currentaffairs.org/2017/11/abuse-by-bosses-comes... This is why unions and collective bargaining are so important. The power of an individual is almost meaningless versus a business of any size.

overthemoon 7y ago
Yes. For every company shamed into sorta kinda doing the right thing, there are so many other less sexy and high profile companies doing the exact same thing. Unions are not perfect, but they're better than nothing.
unreal37 7y ago
Unions are not better. This isn't 1888 any more. They charge the employees a fee every paycheck, but when you need them, they'll do what's in their best interest not yours. As a teen, I was forced to quit a job (with my union rep beside me) for a made up reason. "Better to quit than to be fired" was his advice. Obviously my "quitting" was part of some bigger plan to save a job of his friend or some other concession the boss made to him. Unions protect the employees as a whole but not the individuals. They have their own interests that are not always aligned with the employees either.
thrwwy987 7y ago
Perhaps what this article talks about should be reframed as actual (literal) theft, like the way a burglar or pickpocket does: same as if an employer broke into your home, found your wallet, and removed $20 from it that a customer had literally handed to you as their gift to you. Literal burglary/theft/etc. That would frame it in a way that doesn't somehow legitimize it, and would make employers seem, and be, far more criminal after they decide to reach into someone's pocket and steal cash.

imgabe 7y ago

Tipping just needs to die. If your business model demands that customers pay your price + 20% to pay your employees a wage they'll accept, then just increase your price by 20% and pay your employees that wage to begin with. Don't lie to customers and tell them the price is 20% lower than it really is when they're expected to add on more.

draw_down 7y ago
I love when these stories pop up because I get to see HNers grind their axe against the general practice of tipping. You all never disappoint!
Phobophobia 7y ago
I generally concur. Living in Japan for a month, attending budget and 5-star accommodations and dining, it was very streamlined to have minimal tipping expected [or unexpected].
- s_y_n_t_a_x 7y ago
  I've lived in Japan, and you notice the lack of tipping culture. Service is a lot worse. Go to any restaurant, you won't get service, refills etc. You have to yell or get it yourself. That's what the service would be like without tips. Servers have no incentive to take care of your table if they get paid the same either way. I'm fine with that system, as long as it's setup that way. Give me a way to refill my drink etc. But sometimes it's setup where they have to do it, and you're either waiting an hour for a drink or a check.
  - asark 7y ago
    Other countries don't have the same notion of what good service is, and don't expect the server to be up your ass about drink refills every 30s to count as good service. They expect you to ask if you need something, so they're not bugging you. It's just a difference in what's considered better. You see the other style at finer (expensive) restaurants in the US, sometimes. It's really nice to be able to chat with your fellow diners without some stranger constantly bugging you while being pretend-nice.

lancesells 7y ago

Amazon Primenow unfortunately does the same thing. I wish that would become a story as well.

miaklesp 7y ago
Just set tip to 0 every time.
- Pfhreak 7y ago
  And tip in cash.
- lancesells 7y ago
  While that works for me I'm guessing 95% of the people using Primenow don't know to do that. Amazon is 100x larger than DoorDash and needs to be called out on it.

unreal37 7y ago

I think North America really needs to re-evaluate this concept of tips. The rules of what to tip and when are intentionally vague because it's a sensitive subject. We should move to "fair pay", that includes slightly increased prices, and do away with tips for most services. It's so common that tips don't mean what the consumer thinks it means. Restaurants and bars that pool tips and share them with all staff.[1] Restaurant owners that try to keep some tips and only pay out a percentage to the staff.[2] Casinos pool tips too so the dealer doesn't get to keep the money you gave him directly.[3] I get asked for tips at Starbucks. I get asked for tips when I do takeout food from the local restaurant. I get asked for tips at the buffet restaurant. The pizza driver gets a delivery charge AND a tip! Let's clean it up and make it fair for the servers and the consumers. [1] https://www.restaurantscanada.org/industry-news/aware-ontarios-tip-pooling-rules-regulations/ https://www.restaurantscanada.org/industry-news/aware-ontari... [2] https://www.restaurantbusinessonline.com/advice-guy/can-restaurant-owners-share-tip-pool https://www.restaurantbusinessonline.com/advice-guy/can-rest... [3] https://www.businessinsider.com/wynn-tip-sharing-2011-6 https://www.businessinsider.com/wynn-tip-sharing-2011-6

alteria 7y ago
The usual explanation for tipping is that the minimum wage for tipped employees is lower than the non-tipped minimum wage (sometimes as low as $2.13). If you knew everyone was getting paid the minimum wage, would you still tip on a regular basis? I recently learned that in states like Washington, California, Oregon this is the case [1], and have been tipping less as a result, but still feel slightly bad about it (societal conditioning is strong!). [1]https://www.minimum-wage.org/tipped https://www.minimum-wage.org/tipped
- rhino369 7y ago
  >The usual explanation for tipping is that the minimum wage for tipped employees is lower than the non-tipped minimum wage (sometimes as low as $2.13). People get the cause and effect backwards on that. The minimum wage is lower because lawmakers knew they were already getting compensated by tips. It's a social custom, not charity.
- 7y ago

radcon 7y ago

I can't believe that was legal. They basically tricked consumers into giving them millions of dollars. If the app called it a "Tip" then that should be some kind of fraud because it wasn't a tip in the way that any reasonable person would assume, it was a donation to the company.

kevinventullo 7y ago

I stopped using DoorDash a few years ago after reading about this. Despicable.

sambroner 7y ago

I'm regularly confused by tipping. I was never confused by tipping until the gig economy. There's a tip on almost all of the gig services I use now, with zero explanation of how the tip affects the gig worker. The tip should be a reflection of the workers contribution to the service. I probably won't ever tip a company. DoorDash has raised $2Bil from investors. They're using this money, presumably, to attract customers and suppliers through advertising and low pricing. DoorDash is one of many companies using VC money in this way. Now I'm supposed to subsidize the VC's subsidy of the product?

TeMPOraL 7y ago
After the previous tipping drama (Instacart?), and little earlier my discovery that a tip in a hotel restaurant actually doesn't go to waiters, but its taken by the owner, I started to ask workers whether or not they receive the tip in full. So e.g. now I happily tip FreeNow (née MyTaxi) drivers, having two of them confirm to me that they pocket entirety of the tip.

nafizh 7y ago

Starup industry's break fast motto has become more like break every kind of decency these days.

Dirlewanger 7y ago

If we had a populace educated in basic personal finance, the gig economy would not exist.

notJim 7y ago
I don't see how? It seems like the gig economy is essentially profiting from the fact that there are a lot more workers available than decent jobs. How would personal finance education change that situation?

souterrain 7y ago

Wage theft is theft. DoorDash, and the VCs backing them, should be treated as thieves until such time as they unequivocally reject the practice of wage theft in all of their business dealings.

neilv 7y ago

I thought management taking a cut of tips was known in the American restaurant/takeout industry to be illegal. And at least one other prominent dotcom has already been called on this. Is this yet another instance of a dotcom knowingly and blatantly ignoring existing laws and regulations, and seeing how much they can get away with, while they use this advantage to steam full-ahead towards market dominance and IPO? Is DoorDash yet influential enough that they can turn this into merely a regulatory handslap/caress?

ycombonator 7y ago

They misrepresented the tip charges to the customers. Where is FTC ? and why isn't there an investigation ?

malandrew 7y ago

Moral of the story is to never use DoorDash at least not until they pay back all those drivers the tips they stole.

parliament32 7y ago

My biggest gripe with tipping culture right now is the number of services and establishments that think it's okay to tip ahead of time. If I sit down at a restaurant, and get served well, I'll leave a tip at the end when I pay. Hell, even if the service isn't great I'll still leave a bit of a tip. But now there's this idea that you should tip for service... before you get served. The tip jars at Starbucks, apps that ask you to input your tip before you get your delivery, POS systems that ask for a tip, etc. There's no way I'll ever tip before service, and probably won't after either if the business is audacious enough to ask for a tip when they're using a pay-before business model. I'm looking forward to seeing how long it takes for self-service gas pumps to start asking for tips. After all, there's an attendant inside keeping an eye on you, so that's a service right?

charliesharding 7y ago
I agree - I think it's an absolute misunderstanding of what a tip means. It completely removes incentive for the dasher to follow delivery instructions, grab extra napkins, ensure food is stored upright, etc. I would be so much more on board with agreeing to a set tip amount beforehand if I don't manually enter one after the food was delivered after x amount of time..
umvi 7y ago
This is so annoying! It's like an automatic thing now when paying in a trendy store using an iPad. It's like, I just ordered, but before I've even gotten my goods, I'm presented with a dialogue on whether I want to pay 5%, 10%, 15% tip (or "no tip" as a small button at the bottom). I'm sure these businesses have found that merely including the dialogue = free money, so why wouldn't they?
- neura 7y ago
  I've had several experiences lately where the tip dialog only offered 15/20/25% or "other" (which could be used as "none")
  - FireBeyond 7y ago

tareqak 7y ago

DoorDash (YC s2013) [0]. [0] https://www.ycombinator.com/companies/ https://www.ycombinator.com/companies/ (search for DoorDash)

EGreg 7y ago

Hey all. Can someone explain to me WHY in 2019 we still tie the infrastructure to the power to make decisions? Marketplaces are built not on open protocols (like email) but closed platforms. They amass people from both sides and extract rents. But that’s a side effect of the closed nature of the software. Why yell at doordash or uber or facebook to add a feature? Why does country X go after them for deleting posts while country Y yells that they didn’t delete similar posts? Closed software is the issue. “Zero to one. Competition is for losers” is who funded Facebook. If people wanted to add tips in Wordpress or Email or whatever, they could just go ahead an add those. Or a million other features. Their clients would still interoperate. Main reason: the capitalistic system we have encourages getting very wealthy as a result of building a successful company. It encourages people to work extremely hard and take risks while competing and duplicating 90% of the work others are doing. But in the area of software and information, copying is so easy. Collaboration beats competition nearly every time, relegating the proprietary solutions of yesteryear to obsolescence. The private market is reduced to turning out brief “bleeding edge” innovations which are then subsumed into the open source snowball. Wikipedia, the Web, Webkit, Wordpress, MySQL and NGinX has beat Britannica, AOL, Blogger.com, IE, Oracle and IIS. So why don’t we have more of it in other areas? Drugs? Marketplaces? Albert Wenger from USV has a nice online book called “World after Capital” that speaks about this.

elicash 7y ago

DoorDash CEO: "our average contribution to Dashers stayed the same" What weird, coded language. They're not "paying employees." They're "contributing" to "Dashers." At first, I figured this was just a way to avoid saying that they're independent contractors, but this seems even more vague than THAT. Why, legally, would they say "contributions" rather than "pay?" It seems like there's a different distinction from the independent contractor one.

somebodythere 7y ago
Because. DoorDash would not like you to think it's that you paying DoorDash and DoorDash paying Dashers. That would, in fact, make them independent contractors. Instead, DoorDash would like you to think that you are paying the Dasher directly. DoorDash provided you a platform to find a Dasher and enter into a delivery agreement with them. And DoorDash is graciously "contributing" to the Dasher's income. This would make them no more an independent contractor than someone looking for work on Craigslist. I don't think this holds up because DoorDash is custodial of the money before it reaches the Dasher's wallet, and because from the customer's perspective, they're ordering delivery from DoorDash, not a Dasher. But that's just my idle speculation.
- scrollaway 7y ago
  How is what you're describing different than a freelancing platform like upwork? I'm sure the service terms are different but in upwork's case, they're also acting as the escrow and taking a cut.

40acres 7y ago

I think tipping is ingrained in American culture because of the lack of price transparency throughout this economy. This has been a recent topic of discussion in regards to healthcare but it also shows up in retail, where the shelf price is not reflective of sales taxes, and when booking services like flights and hotels where "resort fees" and "baggage fees" rear their ugly head last minute. I've even seen "no tipping" restaurants do the same with a fine print saying that a 15-18% gratuity will be charged on top of my order, well.. why aren't all the dishes simply 15-18% more expensive then?

iguy 7y ago
When I'm king this will count as false advertising. The biggest printed price must be the price you pay, by default, unless you specifically ask for something unusual.
121789 7y ago
I don't think that's the problem. I'm American and I'll generalize a bit and say Americans are generally comfortable with tipping as long as the service is a differentiator for what you receive (full service restaurants, hair stylists, drivers, bartenders). The recent frustration has been the explosion of tipping where service has nothing to do with the experience, like fast food restaurants or low cost coffee shops.
- throwtipaway 7y ago
  No we are not comfortable with tipping. Many people like me do not tip even though we get weird looks or the occasional angry waiter.
  - tyrust 7y ago
    Even if you aren't comfortable with it you ought to do it in America. Your protest only hurts the underpaid laborer.
    - lh7777 7y ago

miaklesp 7y ago

I never pay any tips except in restaurants. I always set tip to 0 in Prime Now etc. I makes me feel good that I can spend the saved money on myself.

rconti 7y ago

There was a really easy fix for this. Remove the message that says "100% of your tip goes to your Dasher". Stop lying to the customer. It's that simple! As usual, the reality of the financial situation is fairly complicated. Doordash guarantees minimums that other such services do not. In other words, in many ways, Doordash was more friendly to their 'contractors' than other services. If they had simply chosen not to be unethical and lie to customers about where their tips go, they could have had it both ways.

FireBeyond 7y ago
Their argument was that it's not a lie. The entirety of your tip _does_ go to the Dasher. ... it's just that they reduce _their_ fee paid to them by, coincidentally, the same amount. And claim that this offers the Dasher "stability".

minikites 7y ago

Many people want to keep the very concept and system of tips in place because it affords them power over someone: https://theoutline.com/post/4602/the-restaurant-industry-is-fighting-like-hell-against-raising-the-tipped-minimum-wage https://theoutline.com/post/4602/the-restaurant-industry-is-... >“Money is power,” said Brooklyn-based waitress Marisa Licandro. “If the customer is paying my wage, they have power over me. And customers having power over you means that you can’t speak against them when they try to grab you. https://www.nytimes.com/interactive/2018/03/11/business/tipping-sexual-harassment.html https://www.nytimes.com/interactive/2018/03/11/business/tipp... >There was the waitress in Portland, Ore., Whitney Edmunds, who swallowed her anger when a man patted his lap and beckoned her to sit, saying, “I’m a great tipper.” https://jezebel.com/what-does-tipping-have-to-do-with-sex-and-power-1156118970 https://jezebel.com/what-does-tipping-have-to-do-with-sex-an... >And his go-to line was so predictable, we would wait for it, anticipate it. “I always tip way more than twenty percent!” >If that was the case, why were these guys so mad about paying only 18%, far less than they otherwise would? What was it about not choosing the amount they tipped, that infuriated them, even when they were getting a discount? >It had to be at least partially about lack of control. Or, more accurately, lack of imagined control. This guy thought that, in a tipped environment, his server would perform better in order to get more of his money. That idea is false, as shown both by repeated studies and common sense, but that was irrelevant. His anger could not be redeemed by mere facts.

GigLoL 7y ago

The "gig economy" is designed for the idiots on both sides. The idiots that use these services. The idiots that "work" for these services. Can't wait until it all goes away.

johnwheeler 7y ago

Doordash is so stupid. I should be able to tip after I get my order, not before. Until they fix that, the model is backwards and broken for the consumer

oiasdjfoiasd 7y ago
yeah, lol. once you do it once, you'll never do it again. Add tip. Delivery driver fucks up the order/super late/spills your drink. Too late! already tipped.

pacetherace 7y ago

Tipping model is at its tipping point. It is high time US citizens stop tipping and make businesses realize that the customers are not directly responsible for employee wages.

cameronbrown 7y ago
Devil's Advocate: Many people in the hospitality industry are making far more via tips than they'd receive from a market wage.
- dajohnson89 7y ago
  many people are also NOT making what they could be making, if paid a fair wage. At the very least, they're subject to an insane amount of income insecurity. If a bartender at a sluggish restaurant is scheduled monday-wednesday, instead of his usual fri-sunday, he's probably screwed and making a fraction of what he normally does.
  - walru 7y ago
    True, but at the same time not every bartender makes a great cocktail, or cares to. If people want service levels to race to the bottom this is the way to do it. The main problem with the DD model is that they're asking people to decide a tip before being provided a service. That's unfair to the customer and driver. As far as paying a decent wage before that, DD could provide a mile cost reimbursement as well as one for the time spent on the order. Paying the driver a blanket fee for every order they deliver rather than one based on time and millage is not sustainable. I understand that's much how the model used to work, but the whole thing about tip culture is rewarding people who do the little things to make the experience worth it for you having to pay extra. As a customer of DD you're only going to be aware of things after you've received your food. Also, if a bartender is not getting the best shifts, that may be because the bar cycles their shifts or they aren't as good, or maybe Wednesday is a busier night and they only staff one bartender so that person may end up doing better than having to split a bar with several others. That said, if it's busier on a Saturday and the bartenders are getting hammered, why should they have to subsidize the bartender who isn't there?

thallavajhula 7y ago

This is great. But, I got excited thinking that DoorDash changed their tipping UX by allowing users to tip after the service is rendered.

robocat 7y ago
Can't you tip with cash?

larrybud 7y ago

It seems like the simple answer to this is to tip out-of-band directly to the person (e.g, cash, venmo, etc).

g9yuayon 7y ago

I feel sick to my stomach. I give tips specifically to the drivers, yet those companies took a cut without even telling the drivers. A so-called high-tech company behaves like a rogue restaurant owner. How low can we go?

jdkee 7y ago

Solution: tip in cash.