SAN FRANCISCO (CBS SF) — San Francisco officials announced Monday that they have reached a $5.325 million settlement with DoorDash for alleged violations of local labor laws.

City Attorney David Chiu made the announcement in the wake of a San Francisco Office of Labor Standards Enforcement investigation into alleged violations by the delivery service of the city’s health care security and paid sick leave ordinances.

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Under local laws, an employer with 20 or more workers is required to spend a minimum amount on health care benefits per covered employee.

Employers also are required to provide sick leave to all employees in San Francisco.

The vast majority of the settlement — $5,137,953 million — will go directly to DoorDash workers who made deliveries in San Francisco between 2016 and 2020. The remaining $187,046 will cover the cost of the investigation.

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“We are living through an era of deep inequality, and nothing could be more important than ensuring workers are paid fairly and their benefits are safeguarded,” Chiu said in a news release. “The city conducted a thorough, diligent investigation that resulted in this unprecedented settlement for San Francisco workers.”

Supervisor Aaron Peskin alerted labor standards officials to the violations after media reports of DoorDash allegedly misclassifying its workers and using customer tips to subsidize the base pay of workers.

“While this wage theft complaint was filed three years ago, it covers conduct that DoorDash continued during the pandemic, a particularly devastating time for workers and small businesses,” Peskin said in a news release. “We hope this victory brings restitution and relief to those harmed, including the knowledge that this settlement is a tacit acknowledgment that drivers are workers – and as such, have rights and protections under the law.”

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At $5.325 million, it is the largest settlement secured by San Francisco Office of Labor Standards Enforcement in its 20-year history.