At least some delivery workers for Instacart, a so-called gig economy app that dispatches an army of shoppers and drivers to deliver groceries and other supplies directly from retail stores to customers, have launched a two-day strike from Sunday to Monday in protest of what they claim are abusive working conditions and pay rates below the minimum wage.
Instacart is valued at $3.4 billion, per the San Francisco Chronicle, and employs hundreds of thousands of workers in 154 markets. Approximately 5,200 people have joined an employee group on Facebook to support efforts to change its compensation structure, the paper wrote.
According to Ars Technica, Instacart pays the independent contractors who comprise a large portion of its workforce based on three factors. Those include an algorithmically determined commission ranging from as low as $1 in rural areas to $14 in New York, a per-item fee usually coming to around $.40, and service fees and tips. Key to the dispute is Instacart’s decision to eliminate a default tipping option and tuck it away behind “multiple non-obvious steps,” and instead charge customers a default 10 percent service fee—not all of which goes to the contractors. Multiple Instacart workers told Ars Technica that sidelining tipping had made their income on the app plummet.
“Before my tips were stolen I worked 38 to 40 hours a week and I made $1,200 a week,” Matthew Telles, a shopper and plaintiff in a settled lawsuit against Instacart, told Ars Technica. “I have now had to pare my hours down to the days where I make the most traffic, Sunday and Monday. I work 20 to 25 hours and I make about $300 or $250.”
The per-item fee also doesn’t stack for multiples of the same item, meaning that delivering 10 cases of water pays the same as delivering one.
Sometimes the three separate fees add up to very little, especially if customers abuse the per-item system to get cheap bulk deliveries.
Ars Technica posted several examples of shoppers being paid less than the federal minimum wage, including a 19-hour week in Jackson, Mississippi, that paid out $37.75 (roughly $2/hour), as well as a four hour and 40 minute shift in Atlanta, Georgia, that paid out $3.55 (just over $.75/hour). That’s all not counting expenses incurred by the contractors, like gas and vehicle maintenance.
Though the company is targeting a $14/hour rate, Ars Technica said, it doesn’t publish detailed pay rate data. However, Instacart did connect them with Houston, Texas-based shopper Bradley Egan, who said he made $20/hour and said it was much better than working a regular delivery job.
For its part, Instacart argues that it allows shoppers to choose whether they want to work as contractors or part-time employees.
“Instacart empowers Shoppers by giving them a choice in how they work with Instacart—either as a part-time employee or independent contractor—and we’re working side by side with thousands of Shoppers to create real opportunities,” the company said in a statement to Gizmodo.
It’s unclear whether the strike will have much impact, as the diffused nature of the gig economy makes it difficult for workers to take any kind of collective action—such as with Uber, which was able to get away with poor treatment of drivers and shady safety practices for years.
As UC Hastings College of the Law professor Veena Dubal told the Chronicle, “Casual workers have different and sometimes conflicting interests with full-time workers” and thus less incentive to organize. According to Ars Technica, one shopper named Ike participating in the strike described it as primarily intended “to help the shoppers stand up for themselves,” while Bay Area shopper Jennell Lévêque told the Chronicle that they “want to get Instacart’s attention.”