DoorDash has agreed to pay $131.5 million to resolve allegations that it underpaid delivery workers in New York City, Mayor Zohran Mamdani announced on Tuesday.

The agreement, described by officials as the largest worker settlement in the city's history, also requires the company to submit to a new monitoring system to ensure compliance with the city's delivery worker pay laws.

In a statement, DoorDash conceded that errors had been made, remarking: “Simply put, we screwed up.”

"Although these errors were unintentional, that does not render them acceptable.

At DoorDash, we take pride in our operational excellence – and this fell short of that standard, nor was it tolerable.

Dashers ought to be compensated in full, punctually, on every occasion.

We extend our apologies to the Dashers whom we failed," the company said.

According to City Hall, the bulk of the settlement is to be disbursed to over 260,000 workers who were either underpaid, left unpaid, or compensated belatedly for deliveries made on behalf of DoorDash.

The company is additionally liable for approximately $16 million in civil penalties and other associated costs owed to the city.

“When a worker earns a wage, they are entitled to be paid that wage – not tomorrow, not after a lawsuit, but on time and in full,” Mamdani said in a statement.

“DoorDash underpaid more than 260,000 workers, and today we are recovering that money.”

DoorDash said many of the payment errors were caused by “technical bugs or happened in complicated situations,” such as deliveries that went outside city boundaries, had multiple pickup or drop-off spots or included deliveries that were cancelled or partially completed.

Last year, the company agreed to pay almost $17 million to settle claims that it had unfairly used customer tips to subsidize the wages of its delivery workers in New York, rather than allowing drivers to keep the tips on top of their guaranteed pay.