Gig workers pay slashed; employer refuses to say why

Willy Solis, lead organizer for Gig Workers Collective

PAYDAY IS NOW A MYSTERY FOR DANIEL FEUER. He no longer knows how much he will get paid for his work. There are thousands like him in Canada and the USA. They all work as “shoppers” for Instacart, an app that takes grocery orders online and has their shoppers deliver them to customers’ homes.

Instacart uses a secret algorithm formula to determine what to pay its workers. Not knowing the formula never bothered the shoppers. Earning $1000 a week used to be common. But, since June, pay has plunged to less than $400 a week.

Company claims its not them

Instacart says if there is a drop in earnings it has nothing to do with how they calculate their formula.

Instacart says it hasn’t changed its earnings structure since February 2019. That change came after Instacart faced a U.S. class-action lawsuit for using customers’ tips to subsidize what it paid shoppers.

Feuer is a shopper for Instacart in Whitby, Ontario. He keeps meticulous data on his earnings. He can chart exactly how much his Instacart earnings have dropped. He says he used to regularly earn $40 or $50 an hour. That dropped to below the Ontario minimum wage of $14.35 an hour in June, he says, and continues to drop.

Feuer estimates he now averages $8 to $9 an hour.

He’s got the receipts

“I’ve probably analyzed 3,000 to 4,000 batches of orders from Instacart, just trying to figure out how they establish their pricing model, and I can’t,” says Feuer.

“I’m making much less money, and it’s not about the number of orders going down, it’s about the actual payment for those orders decreasing.”

“My tips used to be about 25 per cent of what I made. Now tips make up 50 per cent of my income,” he said.

Another Instacart shopper in Western Canada told CBC News he supports his wife and three children with his Instacart earnings. He had been earning over $1,000 a week on average for over a year, making $25 to $30 an hour, but said the fees offered currently are so low, many orders aren’t even worth his time to take. During a recent week he made under $400.

“He says his earnings now average “maybe five or six dollars an hour, considering that you still have to pay for the expenses for your vehicle.”

Thousands complain

Private Facebook groups, which include over 7,000 of the more than 20,000 Instacart workers in Canada, are loaded with complaints about pay.

Instacart shoppers are gigs workers and so are considered to be “independent conrators “—not employees. Therefore, they are not covered by minimum wage legislation.

Instacart shoppers are paid $7 to $10 for a “batch,” which can include as many as three orders. They are reimbursed for mileage, but that is “incorporated into a shopper’s batch pay,” according to Instacart.

The private, California-based company has been a major beneficiary of the pandemic’s boom in delivery services.

Financial analysts estimate Instacart is worth $50 billion US. It operates in 5,500 cities in North America, and has signed up half a million shoppers in Canada and the U.S.

Fortunately for these gig workers, Canadian consumers continue to be generous with tips, which has helped ease the pain of the mystery pay cuts.

Gig Workers Collective organizing

A California-based group of 14,000 Instacart shoppers, called the Gig Workers Collective, is demanding better treatment by the company, including measures that would boost pay.

Lead organizer and shopper Willy Solis says, with an algorithm determining shoppers’ earnings, Instacart is able to shroud those calculations in mystery.

“The algorithm is what’s making Instacart a ton of money. And basically they just sit back and watch the register ring while we’re out here trying to figure out a way to make our next car payments,” he said.

Solis says the group is in the process of formalizing a chapter in Canada. “We  expect our membership to continue to grow,” he said

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