Instacart plans to fire more than 1,800 “shoppers” at the store in March, as the delivery service starts cutting labor costs. Less clear is who is responsible for firing them.
The 1,877 people are among the relatively few Instacart workers legally classified as employees, rather than hired. They are paid by the hour, entitled to benefits and work in a single store, picking up and packing orders that others deliver. Among them are Instacart’s only unionized employees: 10 customers, as workers are called, at a Mariano’s supermarket in Skokie, Illinois, and 366 shoppers at Kroger stores across the country. (Mariano’s is also a subsidiary of Kroger.)
An Instacart spokesman said he dismissed workers at the request of supermarkets who wanted to have their own employees do the job instead of the delivery company. Under this model, dubbed “Partner Choice”, employees at a grocery store use the Instacart app to fulfill customer orders.
“As a result of the transition from some grocery stores to a Partner Pick model, we will be closing our operations at selected stores in the coming months,” Instacart said in a statement.
Kroger, however, denied that he had any role in the layoffs.
“The Kroger family of companies was not involved in Instacart’s decision to suspend its store operations model,” said a spokesman in a statement, adding: “For those looking for a career opportunity, we have thousands of retail positions available on jobs.kroger.com. “
More expensive workers
There are less than 10,000 shopper employees in the store on the Instacart platform, compared to half a million independent contractors, which the company calls “Full-Service Shoppers”. These workers pack groceries from many stores and deliver them to customers in the United States
Since 2018, Instacart has cut 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.
“Instacart’s current use of [in-store shoppers] is significantly more expensive on a cost-per-delivery basis than using a pure [full-service shopper] model, “wrote the lawyer in a letter to the United Food and Commercial Workers union, which represents the ten Instacart workers in Skokie.
The use of independent contractors for purchases and deliveries offers the advantage of allowing Instacart to quickly scale its on-call workforce up or down according to business demands, rather than dealing with regular employees.
Dismissed workers will be able to apply for jobs directly at Kroger or other grocery stores and will receive layoff packages of $ 250 to $ 750 each, the lawyer said.
“There was some stability”
For Noelle Marian, one of 10 union workers being fired, saying she appreciates predictability. Marian has been buying for Instacart since 2019, she told CBS MoneyWatch. She chose to buy at the store for Instacart over other types of work because she felt safer working in one location and liked the stability that the job offered.
“It doesn’t pay much, but I can support myself. I can buy groceries, pay for my car, pay my phone bill,” said Marian. “There was some stability, but now it is just going away.”
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 is going to give me a letter of recommendation. I hope that’s not the case for the other team members.”
But she fears that more and more shoppers will be fired until Instacart totally leaves them. She highlighted the deals that the company did last year with Aldi and Sprouts, in which employees from these supermarkets delivered on Instacart’s platform.
“I don’t think they were interested in hiring people to do the real job,” she said. “I think they used us to get data information for their program and now that they have that information, they are systematically getting rid of us.”