Five million dollar settlement demonstrates Mamdani’s commitment to delivery worker rights
Unprecedented Corporate Accountability for App-Based Wage Violations
Three major food delivery companies agreed to pay more than five million dollars in restitution and penalties after New York City found they systematically violated the city’s minimum pay law. Mayor Zohran Mamdani announced the landmark settlement on Thursday during a press conference in Long Island City. According to the city’s Department of Consumer and Worker Protection, Uber Eats, Fantuan and HungryPanda failed to compensate delivery workers for time spent on trips that were canceled between late 2023 and early 2024. The practices affected nearly 50,000 delivery workers who encountered what activists call one of the most devastating forms of app-based labor abuse.
Companies Owed Workers for Canceled Trips
Mamdani addressed the root of the violation: “This is about companies breaking the law and workers not being paid for time they already worked. If you make a living as a delivery worker in New York City, your life is relentlessbiking through rain, heat and snowand too often the mistreatment from massive corporations is relentless too.” The settlement details reflect company-specific violations. Uber Eats will pay 3.15 million dollars in restitution and 350,000 dollars in civil penalties. Fantuan and HungryPanda will collectively pay just over 1.6 million dollars. The city said Uber also agreed to reinstate delivery workers who were wrongfully deactivatedan unprecedented remedy affecting potentially 10,000 people. Uber disputes this figure, claiming only 1,053 workers have been reinstated so far. The company emphasized that the average underpayment was 19.48 dollars per worker.
Deactivation Consequences Devastating for Working Families
Worker advocates emphasized that deactivation impacts extend far beyond app access. Delivery workers report sudden lockouts triggered by app algorithms with little explanation and few appeal avenues. Many wake up to find accounts permanently shut down after years of consistent work, instantly losing income and housing stability. Ligia Guallpa, executive director of Workers’ Justice Project and co-founder of Los Deliveristas Unidos, stated: “For years, these companies treated the law as optional. What they call innovation was really a system designed to underpay workers, cancel trips without compensation and deactivate people without explanation. This settlement shows those days are over.” Aboubacar Ki, a delivery worker and organizer, described the broader reality: “Deactivation isn’t just losing access to an app. It’s losing income overnight, losing housing stability and being pushed into crisis.”
Broader Crackdown on App Platform Violations
The settlement represents only part of Mamdani’s administration aggressive enforcement approach toward app companies. Over the past month, the Department of Consumer and Worker Protection released a report accusing Uber and DoorDash of using interface design tricks that reduced worker tip earnings by more than 550 million dollars. The city also filed lawsuits against delivery platforms accused of wage theft and sent compliance warnings to dozens of app companies. DCWP Commissioner Sam Levine said the settlement demonstrates the city’s growing capacity to monitor companies through required pay data: “For thousands of workers, reinstatement isn’t abstract. It means rent gets paid, food is on the table, kids stay in school, and lives are put back on track.” The city’s minimum pay rule for delivery workers, enacted in 2021, requires apps to pay minimum hourly rates based on active work time. That rate is scheduled to rise to 22.13 dollars per hour in April 2026. Mamdani framed the settlement as emblematic of systemic policy shift: “For too long, government stood with the companies accumulating the wealth. This administration is standing with the people who generate it. In the first month of this administration, our city has made one thing unmistakably clear: there is zero tolerance for exploiting workers, cutting corners on labor protections, or rigging our economy to serve wealthy corporations at the expense of working people.” This approach signals historic accountability for corporations previously operating with regulatory immunity in New York City.
