
Some Instacart workers to strike over pay that can be as low as $1 per hour - gscott
https://arstechnica.com/tech-policy/2017/11/some-instacart-workers-to-strike-over-pay-that-can-be-as-low-as-1-per-hour/
======
TaylorAlexander
I recently ordered from DoorDash, a similar service.

The app gave me a price for the order and then had a line item called “Dasher
Tip” and asked me how much I wanted to put down. I put in $20.

Later when the woman arrived with the food, we stopped to talk for a minute.
She was a little younger than my mom, and said she had just started working
for the service after her husband died.

She asked me if she could ask me an awkward question, but I said okay. She
wanted to know how much I had tipped her. $20.

She showed me her phone with the app on our order. DoorDash told her we had
tipped her $6, which she thought was suspiciously low (we ordered $90 in
food).

TL;DR: DoorDash presented me with an optional field called “Dasher Tip”, which
I wasn’t sure of but assumed this was the Tip for the woman bringing us the
food. I paid $20 for this “tip” but only $6 made it to the woman (whose
husband had died). Incidentally I offered her a cash tip but she refused - she
said I had already paid it and it should come from DoorDash.

Last night my friends wanted to order food again. I called it in to the
restaurant and we picked it up. I don’t want to use DoorDash anymore.

~~~
jeremyt
Call me crazy, but when I use one of these services, I expect the service to
be reflected in the price.

~~~
louprado
I often wonder what uplift the U.S. economy gets because consumers are lured
by an initial low price that doesn't include service fees, taxes, gratuities,
etc. It's like an accepted form of _bait-and-switch_ , which is a proven
tactic that increases sales.

~~~
Spivak
I'm sure it has some effect but it's certainly diminished by the fact that
everyone is aware of the markup and it's the same everywhere.

------
grandalf
The gig economy is always going to be more volatile than full-time work. This
is why grocery stores had not already hired full time drivers to deliver
groceries, and why there is demand for Instacart.

It's the same with Uber. During a rainy day rush-hour there are rarely any
medallion cabs available, so Uber created a way to get transportation on those
days (surge pricing) that incentiveizes drivers to work during those times.

So normal (expected) peaks and troughs in utilization result in a price signal
that reflects demand on a much more granular time scale than simply a full
time or part time worker with a schedule planned months in advance.

There are two ways to solve this, and Instacart and Uber are both following
the approach that is more economically sound -- pass the actual price signals
to would-be workers, so that they can self-select in an optimizing way.

Nearly ever Uber driver I talk to is very pleased to be able to make the money
on his/her terms, even if it's not great money, or if it's not as good as it
used to be.

If we create an old-fashioned, industrial-era labor market overlay for the gig
economy, all we'll accomplish is taking away some good employment options for
those who need them most.

All of the "perks" of the industrial-era labor movement are geared at a
specific labor/employer dynamic. Uber and Instacart are shifting that dynamic
and doing the work of matching supply and demand to make work available that
was not available before.

We must adjust our view of what a "good" and "fair" job is, when we consider
that without the matching mechanism these jobs would not exist. Let's not kill
them off just because someone exploited a loophole about ordering massive size
cases of water.

Ultimately I think the ideal version of "uber for everything" is a worker-
owned cooperative, but until VC gets tired of helping to prove out the model,
such cooperatives are at a disadvantage. That is a temporary disadvantage.
Let's not hamstring the cooperatives before they can even launch!

~~~
thrownblown
One of the lessons of Austin's temporary Uber/Lyft kick out was that very
quickly worker run ride sharing emerged to serve the need.

~~~
mvid
I've used those services. They were buggy and broken to the point where I
frequently ended up walking in the rain because I couldn't get a ride.

~~~
CryptoPunk
This shows basic economics is right again. Division of labour makes the
economy more productive and society more prosperous. The investor/worker roles
are such a division of labour.

~~~
icebraining
Or it just shows that apps need some time to stabilize. The early versions of
VC-funded apps are not always great either, to say the least.

~~~
grandalf
Both are true.

------
PhantomGremlin
Back in the old days, when we actually manufactured clothing in this country,
there was this concept of "piece work". You weren't paid by the hour, but
instead by your work output. E.g. if you were performing some sewing step on a
blouse, such as adding buttons, you might be paid $0.25 per blouse for that
work step.

Of course employers tried to cheat, by setting the per-piece rate very low.
You had to process many pieces to get a reasonable wage.

The Federal government was forced to step in. They required monitoring of all
this activity so that "all employees, including piece work employees, earn at
least the minimum wage."[1]

If only the people running the sweatshops in the old days thought to call
their people "contractors" instead of "employees". They could have avoided
most of the pesky regulation.

I'm being sarcastic. Clearly those people were employees under any reasonable
definition. Same should apply here. This whole gig economy crap has gotten
totally out of hand.

Fundamentally, an Instacart worker only has flexibility of when to work. The
rest is more-or-less predetermined. Should that person be a contractor instead
of an employee because he has his choice of the order in which to traverse the
supermarket aisles? Should that person be a contractor because he has his
choice of which streets to drive on from store to destination?

[1]
[https://en.wikipedia.org/wiki/Piece_work#Minimum_wage](https://en.wikipedia.org/wiki/Piece_work#Minimum_wage)

~~~
themagician
It’s precisely BECAUSE the law hasn’t caught up that most of these exist the
way that they do at all. Instacart, Postmates, Uber, Lyft, Airbnb, etc. all
make profit on the gap between what they pay and what the regulated equivalent
pays. Their big competitive advantage is just lower costs by completely
ignoring the law. We talk about “innovation” but then these services mostly
operate on not paying employees, insurance, benefits, licensing, etc.

If I stop paying taxes and declare my consultancy a religion does that make my
innovative? I’m instantly 40% more profitable than the next guy. You can
“donate” via a mobile app too! It’s not a payment, it’s a donation. Please
note the donation must be as it states on the invoic... err, donation services
document.

~~~
JumpCrisscross
> _Their big competitive advantage is just lower costs by completely ignoring
> the law_

This is disingenuous. Uber started out with Uber Black, which was attractive
because of its customer service. UberX was only launched in response to Lyft.
Airbnb skirted some necessary hotel laws, and many unnecessary ones. Agree on
Postmates and other delivery services.

~~~
zajd
All of them ignored the law. If Uber was just Uber Black you might have a
point.

~~~
JumpCrisscross
> _If Uber was just Uber Black you might have a point_

Uber launched Uber Black, and not UberX, because it was convinced a ride-
sharing service would be shut down by authorities. When Lyft failed to be shut
down, Uber panicked and responded. Next to this ambiguity are several cities'
track records of racist, horrible cab drivers fully embracing their state-
sponsored monopolies.

------
aphextron
Instacart pay depends entirely on where you work. My brother works for them in
SF/SV and earns around $2k/week with wages and tips. For someone with zero
skills or job training otherwise it's a pretty sweet deal. Plus you end up
with a car load of free groceries to take home whenever the system screws up
an order.

~~~
camus2
> Instacart pay depends entirely on where you work. My brother works for them
> in SF/SV and earns around $2k/week with wages and tips. For someone with
> zero skills or job training otherwise it's a pretty sweet deal. Plus you end
> up with a car load of free groceries to take home whenever the system screws
> up an order.

Funny how we were hearing these stories about Uber as well a few years ago,
where people online were pretending some drivers became millionaire working
for Uber. We now know none of this was true.

------
drtillberg
This isn't innovation, it is exploitation. Where are the state attorneys'
general on this? Injured hauling a 600-lb order of sugar and cooking oil --
it's absurd the company does not carry workers' comp insurance for this. In
the real world not carrying workers' comp insurance is very serious business.

This is going to go like Napster, we'll find a better way when it is gone.

~~~
jabretti
But they can opt out of any order they don't want to fulfill, right? Who would
choose to fulfill that crazy order for the price on offer?

~~~
Spivak
It might just be my opinion bit I think that the individual right to refuse is
never enough protection. Especially in employment where preying on people who
can't afford to say no seems to be the norm.

------
username223
> Some shoppers have taken to individually showing their customers how to
> remove the fee ("Do you want to know how to save 10 percent?") and pay their
> shopper directly via tip instead.

This -- just remove the parasites. If you, as an insta-serf, can tell your
customer that "the retail price is $X, you're being charged $Y, and I'm being
paid $Z," you can become a true "independent contractor" by cutting InstaSerf,
Inc. out of the equation. If the difference is greater than zero, split it.

------
notaboutdave
Is this corporate greed or is the value of unskilled labor quickly approaching
zero?

~~~
sulam
I think the value of unskilled, marginal time spent is effectively zero at
times where the utilization is approaching zero.

What I think this demonstrates is that the issue is very uneven demand. An
analogy might be the electric company, which at some points of the day is
literally seeing net negative demand in areas with enough renewable
generation. They have power plants that can run any time, though, whereas gig
workers cannot always pick and choose when they work.

------
couchand
> Instacart has agreed to pay at least several million dollars to settle the
> lawsuits, which will result in a typical settlement payout of a few hundred
> dollars per worker. The attorneys who brought the lawsuits, by contrast,
> stand to make millions.

This seems like an unnecessary and out-of-context dig at lawyers. Also, the
citation provided doesn't square with the claim: the settlement they linked to
allowed total damages of $2 million, and capped the attorney's fees at 25%, so
the maximum payout is half a million.

~~~
Spivak
I get the sentiment that there are some lawsuits where the only people making
real money are the lawyers but I think it's weird that it reflects on the them
and not the system that pays out so little to injured classes. For a case like
this it's easy to rack up a million dollars in billable hours.

------
pw
The stories about large Bay-area tech companies placing enormous orders
through Instacart are pretty appalling.

~~~
hocuspocus
Ironically enough this wouldn't be an issue almost anywhere outside the US,
where online groceries shopping was solved by the supermarkets themselves in
the early 2000s. Despite employee benefits, minimum wages, collective
bargaining and all that.

~~~
GFischer
Well, at least in my country, their websites suck, and you can't guarantee
delivery other than "sometime in the afternoon", meaning if you're on a tight
schedule you're stuck.

------
mpg515
If you do use Instacart, you should definitely opt-out of the "service fee" at
checkout and put that money towards the tip directly for your shopper.

------
tbiwiti
I've said this before, but I think a key component of contractors' rights
going forward will be legislating their employers' ability to "lock them in"
with loyalty programs and the like.

In this case, a large part of the issue seems to be certain orders from people
(and companies) that have found loopholes in the pricing (bulk orders of
large, heavy goods).

If contractors could decline these orders with no repercussions, they wouldn't
be nearly as much of an issue. Instacart would fail to deliver these orders
and quickly learn they need to change their pricing structure.

The argument could be made that you can go too far in giving contractors the
right to decline. I can imagine various forms of extortion occurring or
problems being unable to blacklist problematic contractors, but it's a
tradeoff that seems to be too far in the company's favour right now. Maybe
disincentiving contract work in service-critical environments is a good thing,
considering the complaints about rising part time and contracted work and not
enough full time work.

------
Xunxi
Of all the delivery services out there Amazon Restaurants/ Food Delivery is
the only one that pays right. There's a fixed hourly rate of about $16 that
you receive whether you make a delivery or not. Any tip that you receive if
you make a delivery at some point in time gets added.

All the rest give you a pittance, some even based on mileage. Its a pity!

------
jackvalentine
The obvious 'fair' thing for instacart would be something along the lines of
paying per item with weight taken in to account.

Every packaged item has a barcode that you can look up to see the weight.

...but of course, that would make the commercial delivery services viable
competitors to instacart on big orders right? Can't have that.

------
spo81rty
What I don't understand is if the pay or working conditions are so bad, why
don't people just go find a new job?

If they can't get anyone to do the job, they will be forced to pay more or fix
the conditions. If they have a terrible reputation, nobody will want to work
for them.

It's simple supply and demand.

~~~
tabeth
It boggles me that anyone believes this. It's called leverage. Not everyone
has equal ability, nor equal ability to change jobs for a variety of reasons.

~~~
conanbatt
So what do you think happens to those people if by a requirment on minimum
income by instacart, they are barred from that job opportunity.

------
thisisit
> Ars spoke with six Instacart shoppers who said that they have routinely been
> made to pick up several heavy items, such as cases of bottled water, soda,
> or ice.

In Bangalore, I routinely see people from not only grocery delivery companies,
Big Basket but food delivery like Freshmenu carrying huge carry bags with god
knows how many items. Couple of times I have seen people struggle to get up
the stairs with that much weight on their backs. And those are not contractors
but employees.

I am sure few years later, we will need a study of back or some orthopedic
problems associated with "shoppers".

