feInstacart Gives Shoppers Employee Status, Says It’s To Improve Customer Experience

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(Patrick)

App-based, on-demand services make it easy to order a variety of products and services, and many of the workers who bring you those services are full- or part-time contractors. Some companies, like on-demand ride providers Uber and Lyft, are actively fighting in court to not be forced to give their workers “employee” status. Another company, shopping service Instacart, is proactively making their grocery pickers in some states employees.

Why would they do such a thing? It’s not because they want to get ahead of legal problems, though this announcement comes shortly after the the California Labor Commission declared that a former Uber driver should be considered an employee. Instacart says that the change is because the company wants to improve customers’ experience, which in turn means training order-pickers.

“What we found is that our shoppers require training and supervision, which is how you improve the quality of the picking. You can’t do that when they are independent contractors,” the company’s founder and CEO explained in a statement. The first cities to change their labor model are Boston and Chicago, and others will follow later. Nationwide, Instacart has an estimated 10,000 shoppers-for-hire, so hiring and training them all is a huge undertaking.

In cities where this change is being implemented, Instacart is separating its workforce into two categories: the fleet of delivery drivers will remain independent contractors with more flexible shifts–and, more importantly, they will continue to provide their own vehicles. The shoppers or order-pickers will be part-time workers with more regular shifts.

Shoppers will work fewer than 30 hours per week, which means that Instacart won’t be obligated to provide them with health insurance, but the company will have to withhold payroll taxes, pay unemployment and worker’s compensation insurance, and pay the employer’s portion of Social Security and Medicare.

Order-picking is a very precise skill when your warehouse is an entire Whole Foods or Costco store, and making workers who do that job into employees means that Instacart gets more control over their work and how they’re trained.

Instacart Reclassifies Part of Its Workforce Amid Regulatory Pressure on Uber

by Laura Northrup via Consumerist