“They just roll shit out”: Instacart workers react to the company’s switch from contractors to employees

By Dan Raile , written on July 21, 2015

From The Sharing Economy Desk

Yesterday Instacart announced it was transitioning its contractor workforce to employee status.

Well, part-time employee status, and only for in-store shopping-contractors in Austin and Houston, who will join their fellow-shoppers in Boston, Chicago, Miami, Atlanta and Washington, D.C., in the new classification. As is the case for most product and policy decisions in the “new economy,” the workers themselves had little say in the matter.

I was notified of this development by press release, and my follow up questions were directed to Instacart Vice President of Communications, Andrea Saul.

“We piloted a program earlier this year in Boston, adding responsibility, training and oversight to the Shopper role. It’s a new model we are implementing and are really excited about. By adding those components, we added a lot of efficiency, resulting in more on-time deliveries. Customer experience has improved,” Saul said.

As part-time employees, the in-store shoppers will be eligible for workers’ comp, and payroll taxes will be deducted from their earnings. They will be limited to working 29 hours or less per week, though there is no minimum requirement for weekly hours. They’ll receive a base wage.

“Compensation will be different,” Saul told me by phone. “Rates will vary by market, but be above minimum wage in all regions. And they’ll still be able to make tips and commissions.”

“We’re going to be rolling out the option in our other cities as well.”  

That came as news to the Instacart shoppers and cashiers at a supermarket in San Francisco yesterday, though they said a rumor had been going around about it. Their opinions were mixed.

“It doesn’t really bother me,” said Franz*, a cashier, “but I know some people don’t want it.”

When I approached Franz at the designated Instacart check-out counter, I asked if he worked for Instacart. “Yes,” he replied.

(*At their request, I’m using pseudonyms for the independent Instacart workers cited in this article.)

“Twenty-nine hours might be a problem for me, but I like the base wage, it would be good to know what to expect,” said Terry, a Shopper since February.  

Terry might have misunderstood the base wage concept. Instacart part-timers will still have the scheduling flexibility that Andrea Saul told me they cherish. The way that flexibility works in practice is that Instacart dictates Shoppers’ schedules, and that won’t be changing.

“We’re still scheduling people,” Saul said. “What they do, they submit when they would like to work, if at all. We offer them available times, and then they can choose their schedule.”

Saul said that the recently-adopted practice of “embedding” paid shoppers in supermarkets had been a boon to delivery outcomes. Another Instacart grocery worker, Frank, explained his experience working for the company over the past few months.

“It’s funny how little they tell us, they just roll shit out,” he said. “It’s a black box. For example, if my hours get cut in half one week, and I email “Shopper Happiness,” they won’t explain why. They’ll say something like ‘we’re just scheduling more effectively,’ so I won’t know if there is something I need to change or improve. I understand move fast and break shit, but this isn’t just affecting user experience, it’s people’s livelihoods.”

At the Whole Foods where Franz, Terry and Frank work, the shoppers all get along. But due to the way incentives are aligned, Frank said that’s not always the case.

“You really have to become obsessed with metrics to get a decent amount of orders. It incentivizes speed. The higher you are ranked, the more orders you get. So if you’re twice as fast, you’ll get like five or ten times the orders, while new people wait around for hours for an order, because it takes practice to get good.”

He said he’d heard stories of inter-in-store-Shopper sabotage and altercations, driven by the competitive set-up.

Saul said she expected three quarters of the company’s in-store Shoppers to take the offer. The others could remain independent contractors by taking a driving role. What about those without cars?

“Depending on the city we’ll have different offers, other roles,” said Saul.

Frank had a nuanced view of the coming employment offer:

“I really wonder why they are doing this. Overall I think it will be much better to hire people under a traditional employment model, but for me personally it will suck, because I make way more than they will pay me as an employee. But then, they shouldn’t be making these decisions just for people like me. For a lot people this is their job.” Frank is young and unmarried, and said he is just between jobs. He said he makes about $35 an hour on average, and works about 40 hours per week.

The Instacart shopping operation in the Whole Foods I visited was staffed by employees in all but name. There was a Team Lead approximating the duties of a manager, and they’d taken a remedial test and received a training in how to use the app and optimize their work. When a customer has a quibble with an overripe pear, Instacart steps in to arbitrate the dispute.

Many observers of the “new economy” have welcomed a recent string of announcements from the long tail of on-demand service companies, such as Shyp, Munchery, Zirtual and Alfred, which have classified their worker-fleet as employees. Instacart, which in December raised a $220 million Series C at a $2 billion valuation, is the closest company yet to the rump of the “sharing economy” to take the plunge. Meanwhile, a raft of lawsuits have broken over the head of Uber and are trickling down the graph. Instacart is facing at least one misclassification suit.

In response to emailed questions, Karen Gregory, sociology professor and co-founder of City College of New York’s Digital Labor Worker Group, told me:

“This is a good move for the company and workers and it's a sign that companies are beginning to take seriously the lawsuits they are facing. It also suggests that companies may be taking more seriously the need to invest in workers via training and developing a more stable cadre of workers. Does it go far enough? No.”

“It's a first step toward dealing with the egregious and rampant issue of misclassification, but it will not address the myriad issues that low wage and precarious work create.”

Instacart, it seems, is more enthusiastic than anyone about the change.