As we reach a new height of the pandemic and are relying on grocery store workers and delivery people more than ever, Instacart has announced it’s laying off almost 2,000 in-store shoppers. The layoffs will affect Instacart shoppers across multiple states. Among the 2,000 laid-off employees are 10 unionized Instacart employees based in a store called Mariano's, in Skokie, Illinois — the only unionized employees in Instacart's workforce.
The Skokie shoppers voted to form a union with the United Food and Commercial Workers Local 1546 in early 2020; it was a historic achievement because it's so rare for workers of gig economy tech companies to unionize — many of them are misclassified as independent contractors, who are not protected by the National Labor Relations Act, the landmark labor law that guarantees workers' right to collectively bargain.
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"Instacart firing the only unionized workers at the company and destroying the jobs of nearly 2,000 dedicated frontline workers in the middle of this public health crisis is simply wrong," Marc Perrone, president of UFCW International, said in a statement. "UFCW is calling on Instacart to immediately halt these plans and to put the health of their customers first by protecting the jobs of these brave essential workers at a time when our communities need them most."
Most of Instacart's workers are classified as independent contractors, but in-store shoppers are part-time employees — they pick and pack orders in one store and are paid an hourly wage. Full-service shoppers, on the other hand, are contractors who fulfill your order and deliver it to your door, and they're paid per order. The distinction is crucial because having employee status offers protections and standards such as minimum wage and unemployment benefits.
In a news post published on January 19, Instacart announced that it was scaling down the number of in-store shoppers it employs in order to expand its curbside pickup offerings. "As Instacart Pickup continues to scale and we focus on making it more accessible in 2021, we've begun testing a number of new pickup solutions with our retail partners designed to support their changing needs," an Instacart spokesperson told Refinery29. The company says that in lieu of having Instacart shoppers in their stores, some retailers are choosing to hire their own staff to shop for Instacart orders, partnering with Instacart to use their technology. The company is providing separation packages to laid-off employees, but Vice Motherboard reports that shoppers have been offered severance as low as $250.
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This Instacart layoff is one example of the continuing gig economy expansion, in which work becomes more and more precarious because stable full-time employment is harder to find. Hiring employees is a lot more expensive than hiring independent contractors, and gig work companies have been engaged in a long battle to claim their workers are contractors. States like California have ruled that Uber and Lyft drivers, for example, are employees under the law. But recently, a bill called Proposition 22 passed in California, exempting gig workers of Uber, Lyft, Postmates, DoorDash, and Instacart from being classified as employees; the five companies spent almost $200 million on the campaign. The repercussions are already apparent. Earlier this month, the grocery chain Albertsons announced it would no longer be using its own delivery drivers, and would instead switch to using DoorDash drivers. Labor advocates predict that other states will soon attempt to pass their own versions of Prop 22.
Prop 22 made unionization even harder for independent contractors, and over the past several years, the National Labor Relations Board (NLRB) and the Department of Labor under the Trump administration have made it even harder for gig workers to be treated as employees. One silver lining is that on Wednesday, President Biden fired the Trump-appointed general counsel of the NLRB, Peter Robb, a move that many unions and labor advocates celebrated.
Though Instacart maintains that the layoffs are unrelated to unionization efforts, the fact is that the company will now have zero unionized workers. The Skokie employees voted to unionize last February, but they were still negotiating their first contract when Instacart announced they would all be terminated.
While it's illegal to be fired for unionizing, it can be difficult to enforce — especially if the company states they weren't fired but laid off for other reasons. While workers can be fired even if they're a member of a union, the lack of union protection generally means that you can be terminated for any reason, with no notice.
Today, the Economic Policy Institute released data showing that despite overall union membership falling slightly in 2020 compared to 2019, the percentage of workers in unions had actually increased during the pandemic — because fewer unionized workers had lost their jobs.