Instacart plans to lay off more than 1,800 “shoppers” in the store in March as the delivery service moves to reduce labor costs. It is less clear who is responsible for their dismissal.
The 1,877 people are among the few Instacart workers legally classified as employees, rather than contractors. They are paid by the hour, are eligible for benefits, and work in a single store to pick up and pack orders that others continue to deliver. Among them are Instacart’s only unionized employees: 10 shoppers, as the workers are called, in a Mariano supermarket in Skokie, Illinois, and 366 shoppers in Kroger stores nationwide. (Mariano’s is also a Kroger subsidiary.)
An Instacart spokesman said he fired workers at the request of grocery stores who wanted to have their own employees who work rather than the delivery company. According to this model, called “Partner Choice”, grocery store employees use the Instacart application to fulfill customer orders.
“As a result of the transition of some grocers to a partner model of choice, we will give up operations in the store in certain locations of retailers in the coming months,” Instacart said in a statement.
However, Kroger denied any involvement in the layoffs.
“The Kroger family of companies was not involved in Instacart’s decision to suspend its in-store operations model,” a spokesman said in a statement, adding: “For those looking for a career opportunity, we have thousands retail roles available at jobs.kroger.com. “
More expensive workers
There are less than 10,000 employees in the store on the Instacart platform, compared to half a million independent entrepreneurs, whom the company calls “full-service buyers”. These workers pack food from many stores and deliver it to customers in the United States
Since 2018, Instacart has reduced the number of in-store shoppers on its platform because they are significantly more expensive, according to a lawyer representing Instacart. It has reduced the workforce in stores in Los Angeles, Minneapolis, San Diego, Seattle and parts of Texas.
“Current use of Instacart by [in-store shoppers] it is significantly more expensive based on the cost per delivery than the use of a pure [full-service shopper] model, “the lawyer wrote in a letter to the United Food and Commercial Workers union, which represents the 10 Instacart workers in Skokie.
Using independent contractors for purchases and deliveries offers the advantage of allowing Instacart to quickly increase its on-call workforce up or down depending on business requirements, rather than dealing with scheduled employees.
The laid-off workers will be able to apply for jobs directly at Kroger or other grocery stores and will receive compensation packages from $ 250 to $ 750 each, the lawyer said.
“There was some stability”
For Noelle Marian, one of the 10 unionized workers made redundant, saying that she appreciates its predictability. Marian bought Instacart in 2019, she told CBS MoneyWatch. He chose in-store shopping for Instacart compared to other types of concerts because he felt safe working in one location and liked the stability of work.
“It doesn’t pay much, but I can support myself. I can buy food, I can pay for the car, I can pay the phone bill,” Marian said. “There was some stability, but now it’s all gone.”
Marian also doubts that Instacart will help her find a new job, given her participation in the effort to unionize workers. “I don’t think Instacart will give me a letter of recommendation. I hope that is not the case with the other members of the team.”
But he worries that more and more shoppers in the store will be fired until Instacart leaves them completely. She indicated the transactions that the company made last year with Aldi and Sprouts, in which the employees of these supermarkets would make deliveries on the Instacart platform.
“I don’t think they were interested in hiring people to do the actual job,” she said. “I think they used us for data information for their program and now they have that information, they get rid of us systematically.”