The gig economy isn't as flexible for workers as companies claim
On-demand services, be they for rides or for deliveries or anything in between, are extremely convenient for their users. For their workers? Not so much. A report from Bloomberg highlighted some of the questionable practices of grocery shopping and delivery service Instacart, which allegedly pushes workers into accepting low-paying gigs — even when they don't want to complete them.
Workers on Instacart, referred to by the company as “full-service shoppers" are tasked with taking other people's grocery lists, picking up the items and delivering them to their doorstep. When an order comes in, nearby shoppers are sent a notification on their phone that a new delivery is available. Those delivery requests include information about how many items are required, where the retailer is located, how far they will have to travel to deliver it, and the estimated earnings they will pocket. Instacart has no minimum order requirement, and drivers receive a base pay on a sliding scale that ranges between $5 and $10 per job. In theory, shoppers have the right to accept or reject those potential deliveries as they see fit — other serivces like Uber typically give workers the option to decline requests when they don't work for them. After all, Instacart promises its shoppers a "flexible schedule" where they can "take time off, or work extra when it suits you." But in practice, many of these delivery requests are less than optional.
According to the accounts of shoppers, the job requests only have an "Accept" option. There is no choice to turn down a gig. Instead, to get out of a delivery request, shoppers have to sit through four full minutes of a loud, nonstop pinging sound alerting them that the gig is still available. Shoppers are forced to mute their phone or close the app to escape the sound, which doesn't guarantee they can get out of the gig. Sometimes, those shoppers who close the app or wait out the incessant pinging are greeted with the exact same delivery request again.
That built-in alarm that accompanies each prospective gig isn't the only way that Instacart forces its workers into jobs they don't want. According to Bloomberg, Instacart drivers claim the company will call them, barrage them with text messages, and send threatening messages through the app to push them into taking certain gigs that don't generate enough pay to be worth the shopper's time. If they hold out from these gigs, drivers say they are punished. Instacart limits their future options for completing gigs, effectively restricting them from earning an income unless they are willing to take less desirable delivery requests that generate less money. Instacart hasn't responded directly to the claims of shoppers.
Instacart — like most on-demand services like Uber, Lyft, GrubHub and others — doesn't consider its shoppers to be employees, but rather contractors. That, in theory, works for the shoppers, as it allows them to remain flexible in how much time they spend completing deliveries. It certainly works out great for Instacart, which doesn't have to extend any of the typical protections or benefits to its fleet of shoppers that it would have to provide them if they were employees. But to actually make the most of Instacart, it essentially needs to be a shopper's full-time gig. Shoppers report that the most desirable jobs are only available to drivers who have set hours and have signed up for at least 90 hours worth of shifts over a three-week period, or 25 hours over three weekends. The U.S. Internal Revenue Service considers a person to be a full-time employee if they work 30 hours per week for a full calendar month, so while Instacart's apparent priority requirements fall a week short of the IRS definition of full-time employment, it is giving preference to people who basically work the equivalent of full-time hours.
This isn't the first time Instacart has been caught carrying out some morally dubious practices. Earlier this year, the company came under fire for effectively engaging in tip theft. Shoppers highlighted the fact that the tip provided to them for deliveries was essentially counting against their base pay. In one high-profile case, an Instacart shopper was paid just $0.80 by the company for a gig that took 69 minutes to complete because they were tipped $10, which counted toward their base pay instead of being added on top of it. If the customer had tipped nothing at all, Instacart would have paid more. That is not how tips work. Instacart has since adjusted its payment policy and how it handles tips, but it does little to lessen concerns that gig economy companies are screwing over the contractors that make their services work.
Most of these services, Instacart included, offer services that are heavily subsidized by investor money. Last year, Instacart raised $600 million in funding and was valued at $7.6 billion. Food delivery service DoorDash was valued at $12.6 billion earlier this year. Uber and Lyft went public earlier this year with massive valuations and yet both hemorrhage cash quarter after quarter as they struggle to figure out how to make themselves profitable. Typically the first people who get squeezed when the cash gets tight is the contractors. A 2018 study from the JPMorgan Chase Institute found that Uber and Lyft drivers are making less than they did five years ago. Uber admitted in its financial filings that it plans to cut back on driver bonuses and incentives in order to save money. When those changes prove to not be enough to get companies out of the red, the next thing they will do is start charging you more for the services.
Just remember that if you're seeing prices go up, it doesn't mean that the person working the gig is making more — just that the company behind the service is losing less. Also, consider tipping in cash to make sure it actually ends up in the pockets of the workers. It guarantees they get the tip without it counting against them since the exchange isn't made through the app.
