Instacart and Amazon Workers Walk Out

Skyrocketing demand for online grocery delivery services coupled with an increase in cases of grocery employees testing positive for coronavirus has created a perfect storm within a global pandemic.

Workers at companies such as Amazon and Instacart called wildcat strikes March 30, while some Whole Foods Market employees were organizing a so-called “sickout” March 31, hoping to deliver a message that despite sweeping industry pay raises and massive hiring efforts, compensation and safety measures undertaken by employers during the crisis have not been adequate.

The workers were also encouraging consumer boycotts of the companies during the one-day event.

As its delivery workers prepared to walk out, Instacart said new health and safety supplies for its full-service shoppers were forthcoming, as well as a new customer tip default setting to help shoppers earn higher, more consistent tips.

The company, which recently announced plans to hire an additional 300,000 employees over the next three months, is not the only online delivery company challenged by surging demand spurred by COVID-19. Employees at Amazon’s warehouse in Staten Island, N.Y., reportedly also walked out on March 30 in the wake of last week’s news that several of the warehouse employees there had tested positive for the virus. Amazon recently said it would hire 100,000 additional employees.

Instacart delivery workers, who are independent contractors, cited inadequate on-the-job safety measures and compensation amid the coronavirus pandemic as reasons for the strike. In response, the San Francisco-based online delivery company is rolling out a number of measures focused on increasing its shoppers’ safety and pay.

“Within days of the COVID-19 outbreak in the U.S., we rolled out retroactive sick pay for in-store shoppers nationally and extended pay for all shoppers affected by COVID-19,” said Instacart President Nilam Ganenthiran, in a statement. “We were the first company to launch ‘Leave at My Door Delivery’ to give our customers and shoppers a safer, more flexible delivery option.

“Last week, we announced a new COVID-19 bonus to increase pay as Instacart shoppers step up as household heroes for customers,” Ganenthiran continued. “And now, we’ve sourced, manufactured and are distributing our own hand sanitizer in an effort to expedite distribution lead times and work around supply chain shortages.”

The hand sanitizer spray, which Instacart will begin shipping in the next week, will be available to its shoppers via a special shopper community website.

Instacart is also launching a new customer tip default setting for all Instacart customers across North America. Beginning March 29, all existing customers’ completed orders will now default to the customer’s last tip amount, instead of the previous 5% tip default setting. The new customer tip default feature leverages order recollection technology, which remembers a customer’s previous tip and automatically sets it as their new default tip for all future orders.

For example, if a customer tips 15% to their shopper for great service, their next Instacart order will automatically default to a 15% tip as well, versus defaulting back to the previous 5% default tip. Instacart is also removing the “none” option in the customer tip settings, requiring customers to manually change their tip to $0. Additionally, if a customer lowers the tip below 5%, the default will reset to 5% to ensure shoppers continue to have a baseline tip amount. 

According to Instacart, the new feature is already positively impacting shopper earnings. “Over the last month, 97% of all orders included a tip, and shoppers also on average received a 30% increase in earnings from customer tips as a result of this feature and increased customer demand,” said Instacart. Tips, 100% of which go to the shopper, continue to be separate from any Instacart earnings paid to the shopper.

In the past few weeks, the company has seen order volume grow by more than 150% year over year, with average customer basket size also increasing by 15%. “Based on the rise in customer demand, shopper earnings have increased by more than 40% month over month, and shopper satisfaction, as measured by net promoter score (NPS), is at its highest level in company history,” said Instacart in a statement.

It was unclear how many Instacart workers participated in the walkout or how widespread the Amazon strike was. Instacart insisted it remained fully operational across North America, where it operates in 5,500 cities and more than 25,000 stores across the U.S. and Canada. Instacart said it has already hired an additional 50,000 employees since announcing its expansion plans.  

Amazon reportedly is adjusting to strains on its grocery delivery business by offering some of its workers incentives to temporarily become grocery pickers for its Prime Now and Amazon Fresh offerings. Reuters reported the company was offering up to $19 per hour in some states, based on an internal document it reviewed.

Amazon Fresh delivers items from warehouses. Prime Now utilizes shoppers to pick orders for delivery from Whole Foods stores.

Organizers of the "sickout" scheduled for March 31 were seeking support on an online petition that had more than 700 signatures Monday afternoon.