As a Doordash driver, the whole tipping thing can become very confusing. Quite honestly, I have never seen such confusion over tips in my life. Doordash does not go by the basic tipping rules that we are all used of. Instead, Doordash has applied their own rules about how tipping works, and most dashers do not understand how it works. Besides the dashers, the customers do not even understand how Doordash tipping works. They just assume it is standard tipping and leave tips for their drivers. Even though the Doordash platform makes it look like the standard tipping that we are all used of, in reality it is completely different. Read on to learn more.
 |
| This is what it looks like when you receive an over guaranteed |
Doordash does not pay out tips
In a normal business transaction, a worker receives tips from a customer for their service. The amount of the tip is usually based on how well the customer believes that they were served by the worker. It is up to the customer if and how much they want to tip the worker. Before I go any further, I want to explain that sometimes in restaurants waiters and waitresses will share a cut of their tips to others such as the cook, busboy, etc. All restaurants are different, but in all cases the customer's tips are paid out to those that provided service.
Doordash does not go by the standard tipping rules that we all know. If a customer leaves a dasher a dollar or two on the app as a tip, the dasher will never receive it. When I say never, I mean never. Yes, they will not receive it 100 percent of the time! This is not a sometimes thing or an occasional thing. If a customer is leaving a tip that is $5.50 or under, the dasher will never receive any of that money.
When I first started dashing, I used to think that Doordash customers were just cheap people that never tipped. Every once in a while, about one call out of 30, I would receive what I perceived as a tip. In reality, this was not your standard tip, this is what Doordash calls an over guaranteed.
Even though Doordash tells dashers that they receive 100 percent of customer tips, it is not true and 96 percent of the time Doordash keeps all the tip money that customers leave for the dasher. The only exception is when there is an over guaranteed which is different from a standard tip. Most dashers will perceive this over guaranteed as a standard tip because they do not know that Doordash is cheating them out of all their tip money. Okay, maybe I'm being a little harsh here. Am I being to judgemental? Are they cheating you out of your dashing tips? That is for you to decide when you understand how the whole tipping thing works with Doordash. The saddest part about all of this is that Doordash customers are told that their dasher receives 100 percent of the tip they leave for them, but in reality Doordash keeps that money. If you are still a bit confused read on about over guarantees, and you will fully understand everything.
Doordash pays out over guarantees
Receiving an over guarantee will always make a dasher feel good. Why shouldn't it? It doesn't happen too often. My personal estimate is that a Doordash over guaranteed only happens about 4 percent of the time. When I am guaranteed a certain amount for a delivery, and after sliding I see that I received an over guarantee it is always pleasing. Here I was thinking that I would only receive the guaranteed amount, but after sliding I see that I get an over guarantee of $15, $20, $25 or even more.
With all of that said, you should never mistaken over guarantees with tips. As I have mentioned earlier, Doordash does not pay out tips to Doordash drivers even though they claim that they do. Instead, they pay out what are called over guarantees. To understand how your pay and tips work on Doordash, you have to understand how over guarantees work. If you dash long enough, you will occasionally come across an over guarantee order that you fulfill.
An over guarantee is basically when a customer has tipped more than what the guaranteed amount was for the driver. For example, if a driver is guaranteed $7 for an order, but the customer had tipped $10 during check out, the driver will receive an over guaranteed. In this example, the driver should receive $4 over guaranteed for a total of $11 for this call. Remember, Doordash is supposed to pay at minimum $1 out of their pocket.
Doordash loves orders like this because their out of pocket expense is minimized. The $7 guaranteed amount that the driver knew they were going to receive is paid out to them by the customer. Since the customer tipped $10, the driver will also receive the additional $3 as an over guarantee. With the Amazon required $1 we have a total payment to the driver in the amount of $11. The Doordash driver will be happy when they receive this over guarantee. Instead of receiving the $7 that they expected and were guaranteed, they received $11.
How much would this Doordash driver had earned if they received the tip?
Using the above example still, if the Doordash driver had truly received their tip, they would be driving away with $17 earned for that call. The math is quite simple. The $7 guarantee plus the $10 tip that the customer left equals $17. This is the way it would be if Doordash drivers received their tips. The money earned by Doordash drivers would be much more than what it currently is. With the over guarantees that Doordash pays drivers, our earnings are much less than what they should be.
Earlier I had mentioned that if a Doordash customer tips $5.50 or under the driver will never see a penny. There is a reason for that. On Doordash, the least amount of money that a call pays is a guarantee of $5.50. If a customer tips $2, $3, etc., anything under $5.50, all of that tip money will be applied toward the driver's guaranteed earnings for that call. The Doordash driver will not receive any over guarantee for it and will certainly not receive any type of tip.
Okay then, what would have happened if that customer did not leave any tip?
Again, using the above example, what would have happened if that customer did not tip anything? The driver was guaranteed $7 for the delivery and that is what Doordash is required to pay them. Doordash does not really like these type of orders because they have to issue the whole pay out to the driver. There is no customer tip money to help them out here. Doordash will pay the whole $7 guaranteed amount to the driver.
The reason dashers rarely get over guarantees
The reason over guarantees are hard to come by is because most Doordash orders are not big enough. Think about this. If a customer orders $30 of food, and during check out they leave their dasher a tip for 15 percent, that is a $4.50 tip they are leaving. The driver will be offered their guaranteed pay amount for this call which could be anything but $5.50 will be the lowest guaranteed pay amount. So, if the driver was guaranteed $5.50, and the customer tip was $4.50, we know that the $4.50 is going to be applied to the $5.50 guarantee. When all is said and done, the driver will receive the guaranteed pay for this call which is $5.50. The driver will not receive any over guaranteed pay for this delivery. That $4.50 that the customer left and assumed would go to the driver will not. If customers knew how the whole tipping thing worked with Doordash would they ever tip on the app? Of course they wouldn't. Doordash knows this, and this is the reason that they conduct business the way they do.
The sad fact of the matter is that most calls are similar to this one. In order to receive over guarantees, the order has to be very large and the customer has to be a generous tipper. Of course we all receive these over guarantees every once in a while, but it would sure be nice if they came more often. Even better, how about we all received or tips from the customers instead. Then we would all be smiling as we would be earning what we are really worth.
I'm going to throw another example here for you. Let's say somebody orders $10 of food from Taco Bell, and you are guaranteed the minimum $5.50. The only way that you will see an over guaranteed with this order is if the customer tipped you a crazy amount (which nobody will.). Let's say this customer was an awesome tipper and tipped you 30 percent. That would mean that they tipped you $3. That $3 will of course be applied to your $5.50 guarantee. So, there would not be any over guaranteed pay for you. Sadly, most orders fall into this type of category. Most customers with these small orders are tipping a couple of dollars, but dashers are not seeing any of this money. Doordash will instead use this money to minimize what they have to pay out to dashers. The more customers tip, the less Doordash has to pay its drivers.
Did you ever wonder why customers have the option to tip their drivers during check out? Shouldn't they have the ability to tip instead after the delivery is made? Of course they should, but they don't. This is a business strategy that Doordash has come up with to help them profit. There is nothing wrong with using business strategy to boost your profits, but many feel that by deliberately making your pay module confusing to people is unethical. If you were to ask Doordash customers about the tip money that thee leave for dashers, 100 percent of them would tell you that their driver receives their money. Why wouldn't they believe that? They are told by Doordash that the driver will receive 100 percent of their tip. You see how the deliberate confusion comes in. Doordash knows what they are doing. Are they really telling a lie? They can always say that the driver is receiving the customer's tip money because this tip money is applied to the driver's guaranteed pay.
The purpose of this article was to show readers that Doordash does not pay tips out to dashers. Sure, they may disguise everything and make it seem as though tips are paid out, but they are not. Doordash does not pay out tips. Doordash pays out over guarantees. You must understand the difference if you are to understand how you are paid by Doordash. After reading this article, I hope that you have an understanding of how Doordash over guaranteed pay works. Happy dashing!
I disagree with our premise that the "Over Guarantee" happens when the customer tips and it goes over your market minimum. I do agree that DD is shady in the way they say that dashers receive 100% of their tips while using the tip to make up the market minimum. Let's say I do an order for $7.95 guaranteed. I complete the delivery and receive $7.95. The only way I will know how much DD paid and how much the tip was for that order would be if it was the only order I did for that week. I could then go to Earnings and click on "Details." I would then see the total for "Delivery Earnings," how much DD paid, and "Tip Amount," how much the customer tipped.
ReplyDeleteHere is an example. I did 1 order for a week. It was a guarantee of $9.01 which I received. I did no other deliveries that week. The breakdown was: Delivery Earnings $5.01, Tip Amount $4.00. So DD paid $1 + $4.01 boost + $4.00 customer tip. This goes against your theory because there was no over guarantee.
I think DD has made a change. They used to throw in some extra pay when you contacted support about excessive time you spent on an order. Lately they have told me that the system now considers that and will make adjustments after the delivery. I have received Over Guarantees on these order of a few cents to a few dollars.
I have not seen anyone with direct knowledge give an explanation of the elusive "over Guarantee" that rings true. You said "An over guarantee is basically when a customer has tipped more than what the guaranteed amount was for the driver." In the example I gave that was not true. The fact that the customer tips when they complete the order, so the tip is known by DD when they offer the guarantee to the driver, also makes that not true. My theory is that it is DD's way of playing to the gambler in us. Give a little reward occasionally so they will keep working hoping for another reward. They want the Dashers to be thinking "this is a shitty payout for this order but it might be an over guarantee so I'll do it." So when it is going to be an over guarantee, the guarantee they show you either doesn't have the whole tip, or on includes the partial tip. When you complete the order you see what you would have made whether they did it as an over guarantee or not. So just like a slot machine player who just won a payout, you keep playing hoping for a bigger payout.
Postmates gives you a minimum for each delivery that can be increased by mileage and wait time plus tip which is unlike DD which can use the tip to make up part of the minimum. I wish they would go with the system like PM.
Hello, and thank you for your comment. I have to clear a few things up here. I have never said that the over guarantee is paid to the driver when the customer tips and it goes over your "market minimum." Instead, what I said was that the over guarantee is paid when the customer tips and it goes over the original guaranteed amount that was offered to the Doordash driver. Sorry if this was not clear.
ReplyDeleteThe guaranteed amount that a driver is offered is never the same. In many markets, the minimum guarantee that a driver will receive is $5.50. That does not mean that it will always be $5.50. Most of the time the guarantee that a driver receives is more than their market minimum. I would say the average is about $7.50. Sometimes it is much more than that and can be $10 or more.
When an offer is sent to a dasher, the guaranteed pay that a driver is offered is based on many things. Doordash has their algorithm that they use to figure this amount out. The distance, estimated wait time, whether you have to place the order yourself and many other factors are used to determine what the guaranteed pay offer is for the dasher.
In the example above, it was a $9.01 guarantee. The Doordash algorithm is what came up with this figure. When this offer came to you, you knew that you were guaranteed to receive at least $9.01 for this order. This $9.01 figure was guaranteed to you whether the customer tipped or not. Doordash did not figure this $9.01 number out by looking at how much the customer tipped. The Doordash algorithm figured this number out by doing what is supposed to do which is based on many factors. I once had a Doordash rep tell me that there was around 30 factors that their algorithm considered when figuring out what the drivers guaranteed pay would be and the customer tip is not one of them.
I think where you are confused is that you are thinking that the customer's tip amount is part of this algorithm. Doordash does not use the customers tip amount to figure out what the original guaranteed pay to a driver will be. If they did that, I'm sure that they would make sure that no driver would ever see an over guaranteed.
You are correct when I did say that an over guarantee is basically when a customer has tipped more than what the guaranteed amount was for the driver. In the example that you gave it was absolutely true! You did not receive an over guaranteed. As you said, Doordash paid the $1 that they are required to pay, the customer tipped $4, and Doordash was forced to pay you $4.01 of boost pay to make the guaranteed amount of $9.01.
The algorithm could have came out with a whole different amount for your order had thing been different such as customers location, price of food or many of the other s factors that are used to determine guaranteed pay. If certain factors had been different, your guaranteed pay could have been $5.50 or a different amount. Chances are it would be $5.50 if the customer was a few blocks away, it was a $3 of food order and other factors that came in to play that made it a cheap paying order. Even if it was a $5.50 order, you would not have received an over guarantee because the customer only tipped $4.
Now, how would you have received an over guarantee with the above order? That customer would have had to tipped you at least $8.02. If they tipped you $8.02 you would have received a $0.01 over guarantee. The $8.02 tip plus the required $1 Doordash payment comes out to $9.02. Remember that you were guaranteed $9.01 for this order. There would be no boost pay for this order because there is no need for Doordash to add boost pay to reach your guarantee.
I hope you now have a better understanding of how Doordash over guaranteed pay works. It is not a theory I have given here. It is fact and the way things work. I have almost 5000 Doordash deliveries under my belt and even though nobody knows it all, the information that I am sharing here is indeed fact.
You said it is fact but you give no source for your fact other than some random rep you spoke to. When the customer completes the order they do so with the tip (or lack thereof) included.So when DD puts out the offer they know what the tip is. I have no reason not to believe that when they show you the guaranteed amount it is the $1 + boost + tip.
ReplyDeleteIf you take DD at their word then your explanation of my example makes no sense. You said "Doordash was forced to pay you $4.01 of boost pay to make the guaranteed amount of $9.01." To accept what you say is to accept that the guarantee is calculated by the algorithm. It is not. Boost pay is calculated by the algorithm. $1 is added, then the tip, and presto, you have your guarantee. There is no waiting to see what the customer tipped to determine how much DD has to chip in.
What I hear you saying is they do not factor tip into the guaranteed offer. That makes no sense. Why would they not when they know the tip amount when calculating the guarantee?
Damon Hobbs is correct here. Seems like there is a disagreement as to whether Doordash uses the tip amount in their algorithm. I will say this. If they did use the tip as part of the formula, none of us would ever get an over guaranteed after making a delivery. There would not even be a need for it. If the tip and the $1 from Doordash and pay boost are all calculated to make the original guaranteed pay a driver sees when they get the offer then there would never be an over guaranteed earned by any driver because it has all been calculated already. I've got over guarantees of $20 to $30 before. You would never see an original guarantee of that amount which would be the case if tips and everything else were calculated with the original offer.
DeleteYou mean you agree with him. To say he is correct you have to have evidence. We are all sharing our opinions. As I said in my response, I think the over guarantee is random and probably when there is a larger than normal tip? I don't know. Like you I am guessing.
DeleteWhy, when they know the tip, would they not factor that into the guarantee?
Just a brief comment to say thanks for this blog and A QUESTION. I'm impressed with Doordash's marketing and wonder what they think about me going dtk to local merchants promoting lunch delivery in the town I'm working in. THANKS!
ReplyDelete