Grocery chains nationwide ditching in-house delivery drivers in wake of Prop 22

From today’s Business Insider:

Albertsons and some of its subsidiaries, including Vons and Pavilions, are discontinuing their in-house delivery services in parts of California and other states starting in February. The grocery chains will instead rely more heavily on third-party delivery apps, including DoorDash, to handle grocery deliveries, local news outlet KNOCK reported Monday.

“In early December, Albertsons Companies made the strategic decision to discontinue using our own home delivery fleet of trucks in select locations, including Southern California, beginning February 27, 2021,” Albertsons spokesperson Andrew Whelan told Business Insider.

“We will transition that portion of our eCommerce operations to third-party logistics providers who specialize in that service. Our HR teams are working to place impacted associates in stores, plants, and distribution centers,” Whelan said.

Albertsons didn’t respond to questions about employees losing their jobs. In Texas, the company told the Dallas Morning News that it will also fire nearly 100 employees at Tom Thumb locations.

“With COVID-19 outbreaks spiraling out of control and overwhelming hospitals across California, it is stunning that Albertsons would fire these courageous and hard-working men and women keeping our food supply secure,” Marc Perrone, international president of United Food and Commercial Workers, a major union that represents many Albertsons workers, said in a press release, calling on Albertsons “to immediately halt these plans.”

The move comes weeks after a new California law went into effect that eliminated labor protections for app-based food delivery workers and rideshare drivers, which was authored and bankrolled by gig companies.

As DoorDash, Uber, Lyft, Instacart, and Postmates waged a $200 million battle last year to pass the bill, known as Proposition 22, they pointed to “independent” research claiming it would save as many as 900,000 jobs across the state (it turned out the companies had paid a combined $411,599 to the researchers behind the study).

Albertsons’ plans to cut in-house delivery and route new business to delivery companies like DoorDash, however, shows how Prop 22’s passage potentially pushes adjacent industries to consider cheaper labor options.

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Unfair ratings cost some Instacart shoppers hundreds a week

From today’s New York Times:

Bags of groceries don’t just vanish into thin air. But in case the laws of physics ceased to exist, Loreen Zahara does her due diligence. The Instacart shopper keeps receipts for purchases and even photographs them upon delivery — on a customer’s stoop or in front of their garage.

Yet when one customer gave her a one-star rating over a missing bag of pineapples and another awarded her one star and claimed an entire order wasn’t delivered, it was Zahara who suffered the consequences: a loss of hundreds of dollars of potential earnings per week.

Instacart’s order-allocation system takes the “customer is always right” mantra to new extremes, some of its professional shoppers say. The grocery delivery company presents its workforce of independent contractors with orders based in part on their in-app ratings — those with higher scores get first pick, often leaving behind fewer and less lucrative batches for everyone else. Interviews with more than 10 shoppers and receipts reviewed by The Times show a sharp decline in earnings for shoppers whose ratings drop just slightly below 4.95 out of 5 stars. Often, shoppers said, the negative reviews were beyond workers’ control.

Even though Zahara has evidence those two complete orders reached the customers’ homes, it was enough to drop her rating to a 4.94. She went from earning an average of more than $1,270 per week to $690 per week, while working the same total hours, screenshots and weekly earnings reports show.

When Zahara had a rating of 4.95, compensation for batches of deliveries available to her ranged from $15 to $45. At a 4.94, screenshots show orders dipped to $9 to $22, with those at the higher end in a different county than where she lived and typically worked.

“I just had to live with the bad ratings and bad batches and no money,” she said.

Instacart says the system was developed to ensure ratings are “fair and accurate,” and do not unfairly penalize shoppers.

To protect shoppers, Instacart automatically forgives a customer’s single lowest rating, said Instacart spokesperson Natalia Montalvo. And “ratings that are outside of shoppers’ control” are also forgiven — such as when a customer complains that requested item is out of stock at a store, she said.

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What Prop. 22’s defeat would mean for Uber and Lyft — and drivers

From today’s Los Angeles Times:

One way or another, the business of summoning a ride from your phone is likely to look different in California after Nov. 3.

The future of gig work could hinge on the success or failure of Proposition 22, called the App-Based Drivers as Contractors and Labor Policies Initiative. Uber, Lyft and other companies bankrolling the initiative say it would improve workers’ quality of life, providing new benefits while preserving their autonomy. If passed, the measure would cement gig workers’ status as independent contractors, dealing a huge blow to a labor movement striving to bolster protections for workers at the margins.

Abstract illustration of an app-based driver in a car

Gig companies’ business models rely on hiring large numbers of workers cheaply as independent contractors to provide rides, deliver meals and groceries and perform other services. Assembly Bill 5, a state law passed in 2019, aimed to expand protections to these workers, requiring gig companies to reclassify them as employees.

Proposition 22 represents the companies’ efforts to battle that law and the obligations that come with it.

Uber, Lyft, DoorDash, Instacart and Postmates (which was recently acquired by Uber) have jointly poured close to $200 million into the “yes” campaign, flooding the airwaves and their own apps with ads and making the measure the costliest in U.S. history.

At the heart of it all is a vicious fight to shape the prospects of hundreds of thousands of drivers and delivery workers across the state.

Here’s what you need to know.

What would happen if Proposition 22 passes?

For the companies sponsoring it, the short answer is: business as usual. For workers, it would bring some clarity, at a price.

The text of Proposition 22 assures drivers they would maintain flexibility as independent contractors. The measure offers some benefits similar to those conferred under AB 5, but significantly weaker.

Gig companies thus far have resisted compliance with AB 5, which went into effect Jan. 1. In early August, a judge ordered Uber and Lyft to convert their drivers to employees. At the 11th hour, the companies won a temporary stay of the order from a state appeals court, effectively pushing off the deadline until after voters have their say.https://datawrapper.dwcdn.net/Krp2r/6/

Uber and Lyft presented oral arguments before California’s 1st District Court of Appeal on Tuesday. The court has 90 days to decide whether it will uphold the lower-court ruling. But Proposition 22, if passed, would override protections granted by AB 5.

The measure instead would grant 120% of the minimum wage (state or local, depending on where the driver is). However, this minimum narrowly applies to “engaged time,” meaning the time a driver is on a trip with a passenger or en route to pick up a passenger. One study found drivers spend one-third of their time waiting between passengers or returning from trips, time that would not count toward the minimum wage.

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Will rideshare drivers get paid less than minimum wage under Proposition 22

From today’s Sacramento Bee:

Proposition 22 proposes that gig drivers for companies such as Uber, Lyft and Doordash will get paid 120% of the area’s minimum wage for the time they spend picking up and driving goods or passengers, plus 30 cents a mile.

Proponents of the proposition argue under its calculation, the drivers will get paid closer to $25 an hour after expenses, much more than the state’s minimum wage. But the initiative’s opponents cite a much-published study from the UC Berkeley Labor Center, whose researchers said Proposition 22 will guarantee only $5.64 an hour.

Amid an onslaught of advertisements, Proposition 22 still has a fundamental question to answer: How much will the gig drivers get under the initiative. A Sacramento Bee review found that the answer depends on how expenses and time at work are defined. But it is possible that workers would earn less than minimum wage under the measure.

In 2019, Ken Jacobs and Michael Reich at the UC Berkeley Labor Center published a report saying the gig drivers using Uber or Lyft will only be guaranteed a pay of $5.64 an hour under Proposition 22. They still stand by the number.

Under Proposition 22, drivers could get a pay cut from what they are paid now, Jacobs said. “The guarantee they claim to have,” he said of the gig companies. “is a false guarantee.”

Under Proposition 22, drivers will not be paid for the time they are waiting to give a ride, nor the time they spend preparing and cleaning their cars. That time accounts for some 33% of the drivers’ working time, Jacobs said, citing a 2019 study that looked at Lyft and Uber rides in six metropolitan areas across the country, including Los Angeles and San Francisco. “It’s impossible to do the work without having the time waiting for work,” Jacobs said.

Another report, “Rigging the Gig,” by the National Employment Law Project and the Partnership for Working Families found that drivers working 50 hours a week will be paid $175 to $210 less a week under Proposition 22 compared to the current minimum wage.

Read the complete article here.

Instacart shoppers face unforgiving metrics: ‘It’s a very easy job to lose’

From today’s Los Angeles Times:

Five days a week, Ryan Hartson scours the picked-over aisles of Mariano’s Fresh Market in Chicago to fill grocery delivery orders for Instacart. He clocks in for his shift exactly on the hour — if he’s even five minutes late, he’ll receive a “reliability incident.” Within four minutes he must accept any incoming orders. Any longer and he’ll be kicked off the shift and risk getting an incident. Three incidents in a week and he’s at risk of termination.

“It’s a very easy job to lose,” Hartson said.

To avoid missing orders, Hartson schedules his bathroom visits — after four hours of work, the app notifies him that he has earned a 10-minute paid break. Meanwhile, Instacart managers use the app to see if he’s running behind on his orders. The app also tracks Hartson’s customer communications, automatically searching for specific terms to ensure he’s using Instacart’s preferred script. If he doesn’t, his metrics will take another hit.

Metrics define the experience of Instacart’s part-time workforce. Measured weekly for employees such as Harston is the number of reliability incidents; the number of seconds it takes to pick each item; and the percentage of customers with whom they correspond. Some former and current employees say 5% to 20% of shoppers in a store can be fired weekly.

Even in the data-driven tech world, Instacart stands out for its metrics-oriented culture, interviews with more than 30 current and former employees as well as documents and recordings reviewed by The Times reveal. This drive toward productivity helps Instacart’s profit margins, a vital step for a start-up that recorded its first-ever monthly profit in April, as the coronavirus pandemic heightened demand for grocery delivery.

Instacart says it has eased enforcement of certain metrics during the pandemic, but shoppers say company policies often ignore the realities of the job, leaving them in constant fear of termination over things out of their control.

Instacart says it evaluates shoppers on more than just speed and efficiency. Natalia Montalvo, the company‘s director of shopper engagement and communications, said the in-store shopper role was built on the premise of “flexibility, efficiency, innovation and customer service.”

“Efficiency and fulfillment of customer orders in a timely manner is important,” Montalvo said, “but it’s just one of many factors we look at in our overall business health and growth relative to other contributors” such as revenue derived from advertising for and partnering with consumer brands.

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Strikes erupt as US essential workers demand protection amid pandemic

From The Guardian Online:

Wildcat strikes, walkouts and protests over working conditions have erupted across the US throughout the coronavirus pandemic as “essential” workers have demanded better pay and safer working conditions. Labor leaders are hoping the protests can lead to permanent change.

Food delivery workers have become essential in New York after the city closed restaurants and bars to the public on 16 March.

Norma Kennedy, an employee at an American Apparel clothing plant is one of those people. Kennedy along with dozens of other workers walked off her job in Selma, Alabama, on 23 April after two workers tested positive for coronavirus. The plant has remained open during the pandemic to manufacture face masks for a US army contract.

“We left for our own protection,” said Kennedy. “Beforehand, management said if someone tested positive they would shut down and have the plant cleaned. When workers tested positive, they didn’t want to shut it down. They’re not really concerned about the workers.”

Working conditions, low pay and lack of safety protections have triggered protests throughout the pandemic as workers across various industries, including food service, meat processingretail, manufacturing, transportation and healthcare have come together to protest about issues, many of which were apparent before the coronavirus.

“There are no federal mandates or requirements to implement the social distancing guidance or anything else. It’s only guidance and employers can choose to implement them or not,” said Deborah Berkowitz, director of worker safety and health for the National Employment Law Project. “And that is why, in an unprecedented way, they are walking out to bring public attention to the fact that their companies are not protecting their safety and health.”

Read the complete article here.

California Sues Uber and Lyft, Claiming Workers Are Misclassified

From today’s New York Times:

California’s attorney general and a coalition of city attorneys in the state sued Uber and Lyft on Tuesday, claiming the companies wrongfully classified their drivers as independent contractors in violation of a state law that makes them employees.

The law, known as Assembly Bill 5, requires companies to treat their workers as employees instead of contractors if they control how workers perform tasks or if the work is a routine part of a company’s business.

At least one million gig workers in the state are affected by the law, which is supposed to give them a path to benefits like a minimum wage and unemployment insurance that have been traditionally withheld from independent contractors.

Although A.B. 5 took effect on Jan. 1, Uber, Lyft and other gig economy companies that operate in California have resisted and are not taking steps to reclassify their drivers. Uber, Lyft and DoorDash have poured $90 million into a campaign for a ballot initiative that would exempt them from complying with the law. Uber has also argued that its core business is technology, not rides, and therefore drivers are not a key part of its business.

The lawsuit also claims the ride-hailing companies are engaging in an unfair business practice that harms other California companies that follow the law. By avoiding payroll taxes and not paying minimum wage, Uber and Lyft are able to provide rides at “an artificially low cost,” the suit claims, giving them a competitive advantage over other businesses. The suit seeks civil penalties and back wages for workers that could add up to hundreds of millions of dollars.

“California has ground rules with rights and protections for workers and their employers. We intend to make sure that Uber or Lyft play by the rules,” Xavier Becerra, California’s attorney general, said in a statement. The city attorneys of San Francisco, Los Angeles and San Diego joined in the lawsuit.

California’s move is a significant threat to the gig companies and could influence other states with similar laws to take action against them, labor experts said.

Read the complete article here.

Amazon, Instacart Workers Demand Coronavirus Protection And Pay

From NPR News Online:

Some Amazon warehouse workers in Staten Island, N.Y., and Instacart’s grocery delivery workers nationwide walked off their jobs on Monday. They are demanding stepped-up protection and pay as they continue to work while much of the country is asked to isolate as a safeguard against the coronavirus.

The protests come as both Amazon and Instacart have said they plan to hire tens of thousands of new workers. Online shopping and grocery home delivery are skyrocketing as much of the nation hunkers down and people stay at home, following orders and recommendations from the federal and local governments.

This has put a spotlight on workers who shop, pack and deliver these high-demand supplies. Companies refer to the workers as “heroes,” but workers say their employers aren’t doing enough to keep them safe.

The workers are asking for a variety of changes:

  • Workers from both Amazon and Instacart want more access to paid sick time off. At this time, it’s available only to those who have tested positive for the coronavirus or get placed on mandatory self-quarantine.
  • Amazon workers want their warehouse to be closed for a longer cleaning, with guaranteed pay.
  • Instacart’s grocery delivery gig workers are asking for disinfectant wipes and hand sanitizer and better pay to offset the risk they are taking.

Read the complete article here.

Pandemic Erodes Gig Economy Work

From today’s New York Times:

It was just after 11 a.m. last Wednesday when Jaime Maldonado, 51, pulled his rented Nissan into a lot outside San Francisco International Airport. He figured he had a long wait ahead — about two hours — before Lyft would ping him to pick up a passenger.

Occasionally, jets roared overhead — but not many, which meant not enough passengers for Mr. Maldonado, who said that before the coronavirus outbreak, he spent just 20 to 40 minutes waiting outside the airport for customers. To kill time, he got out of his car, looping the mask he recently started wearing around his wrist, and went to talk to other drivers.

As the minutes ticked by, Mr. Maldonado wondered out loud, “What am I going to do to pump gas and feed my kids tomorrow?” His number of rides in a typical week had dropped to around 50 from 100 earlier in the month, he said, and his payout had plunged by half to about $600 a week, from which Lyft would subtract the rental fee for his car.

The coronavirus pandemic is exposing the fragile situations of gig economy workers — the Uber and Lyft drivers, food-delivery couriers and TaskRabbit furniture builders who are behind the convenience-as-a-service apps that are now part of everyday life. Classified as freelancers and not full-time employees, these workers have few protections like guaranteed wages, sick pay and health care, which are benefits that are critical in a crisis.

While gig economy companies like Uber and DoorDash have promoted themselves as providing flexible work that can be lifelines to workers during economic downturns, interviews with 20 ride-hailing drivers and food delivery couriers in Europe and the United States over the past week showed that the services have been anything but that.

Instead, as the fallout from the coronavirus spreads, gig workers’ earnings have plummeted and many have become disgruntled about their lack of health care. Many others are also feeling economic pain from the outbreak — layoffs have hit workers in retailing, airlines, hotels, restaurants and gyms — but even as public health agencies have recommended social isolation to insulate people from the virus, gig workers must continue interacting with others to pay their bills.

Read the complete article here.

In major ruling, San Diego judge says Instacart will flunk AB 5 contractor test

From today’s San Diego Union-Tribune:

A San Diego Superior Court judge has ruled that Instacart is likely misclassifying some of its workers as contractors — when the law requires they be classified as employees — marking a notable step toward enforcement of the controversial new state law known as AB 5.

But the ruling came with a healthy dose of skepticism from the judge over the “wisdom” of the law itself.

Judge Timothy Taylor issued an injunction Feb. 18 against Instacart in San Diego Superior Court, essentially warning the San Francisco company that it’s failing to comply with the state’s labor laws. Instacart disagrees with the ruling, and plans to file an appeal, the company said in a statement Tuesday.

Instacart, which operates nationally and has a presence in San Diego, is an app that allows customers to place grocery orders online, which are then purchased and delivered by gig workers called “shoppers.” The labor law case, filed by San Diego City Attorney Mara Elliott in September, takes issue with how the grocery delivery company classifies its shoppers.

The suit alleges that Instacart shoppers do not qualify as independent contractors under a 2018 California Supreme Court decision (Dynamex Operations West, Inc. v. Superior Court). It’s the Dynamex case that spurred Assembly Bill 5 to move its way through the state legislature last year, sponsored by Assemblywoman Lorena Gonzalez (D-San Diego), and signed into law by Gov. Gavin Newsom. The law went into effect Jan. 1.

According to Judge Taylor, the law makes it clear that Instacart is in violation, calling California state policy “unapologetically pro-employee.”

“While there is room for debate on the wisdom of this policy, and while other states have chosen another course, it is noteworthy that all three branches of California have now spoken on this issue,” Taylor wrote in a court filing dated Feb. 18. “The Supreme Court announced Dynamex two years ago. The decision gave rise to a long debate in the legal press and in the Legislature. The Legislature passed AB 5 last fall. The Governor signed it. To put it in the vernacular, the handwriting is on the wall.”

Read the complete article here.