Instacart is a grocery delivery service that takes orders and facilitates communications between customers and employees using its web-based application and mobile application. Most of its groceries are delivered on the same day that they are ordered. Founded in 2012, the company has expanded its operations from select areas of San Francisco, California, to many major cities across the United States and Vancouver and Toronto, two of Canada’s largest cities and metropolitan areas.
The company makes money via an upcharge ranging between 10 and 20 percent and through a delivery fee.
Recently, Instacart added an optional feature to its mobile and Internet-based interface that allowed customers to leave the company’s employees tips based on their performance.
News recently broke that the entirety of tips, all of which were supposed to be given directly to Instacart’s shoppers, were held by the company and used to pay their hourly wages. In effect, Instacart stole tips from its employees.
In response to news stories that slam Instacart for its bad business practices, the company immediately decided to go through with a revision of its payment policies. Released yesterday, Wednesday, February 6, the payment policy revision was outlined in a press release published directly by Instacart that can be found on Medium.
Here’s How The Company’s Payment Policies Will Change
Every single trip that Instacart’s shoppers made was supported by a minimum $10 earnings floor. The company maintained that tips, if they were provided, would go towards this minimum earnings amount.
Instacart admitted that the aforementioned payment guarantee was “misguided” and that the company would immediately quit using the system of payment.
Up until yesterday, the lowest batch payment was a measly three dollars. This minimum batch payment will more than double to a minimum of seven dollars, potentially reaching a high of $10 in cases where shoppers will be required to shop for customers’ items, pack them in Instacart’s crates, and deliver them directly to customers. These batches are known by the company as full-service batches.
From now on, delivery-only batches will feature a minimum payment of five dollars.
Instacart also made clear that it would institute a bonus based on the quality of shoppers’ performance. Further, all orders made during peak business hours would also receive yet another bonus. All tips, as already stated, will be handled separately from these payment conventions.