- The layoffs include 10 unionized workers at a grocery store.
- The party voted to unionize last year with United Food and Commercial Workers.
- Instacart’s changes would affect some 1,800 employees.
Instacart is laying off each employee who voted to unionize. The news comes as the company closes in-store operations In the midst of the coronavirus pandemic at several grocery stores. In addition, the layoffs affect 10 unionized workers at a grocery store named Mariano’s.
The party voted to unionize last year with the United Food and Commercial Workers Local 1546 in Skokie, Illinois, a suburb of Chicago (UFCW). The decision was a historic win for gig workers. It marked the first time that employees of tech companies have formed a union. The union will collectively bargain for better wages, benefits, and working conditions. Especially for those who rely primarily on contract labor.
Instacart’s take on affected workers
The grocery distribution company lists most of its employees as independent contractors. Their numbers during the coronavirus pandemic have ballooned to more than 500,000. But the organization employed a small subset of workers as staff beginning in 2015. They are entitled to protections such as minimum wage under U.S. law and may be subject to further guidance and instruction by their supervisor.
Instacart says it is trying to position the affected workers in retailers with jobs or place them in other grocery stores that still rely on Instacart shoppers. Instacart said these changes would affect about 1,800 employees, in total. Those laid off would receive separation packages says Instacart. But Instacart would provide about $250 and $750 for the staff they let go, according to UFCW.
Employee’s response to the news of layoffs
The workers were in the process of negotiating their first contract when news of the layoffs struck. “For any gig workers who are trying to do something to make these jobs better, these layoffs are totally discouraging,” said one unionized worker. The workers said they were negotiating for health care and sick time in their original deal.
The news could have a chilling impact on Instacart employees’ other organizing activities around the country. The leadership of the organization has also shown its animosity towards organizers, conducting a union-busting program that included taking managers to the Skokie grocery store to urge workers to vote against the union.
Since the pandemic changed the in-store shopping model of the business, a major rise in demand for grocery delivery has also been brought about. Instacart is will be going public this year. The business could value at about $30 billion post listing.
All of this comes as Instacart is preparing itself to go public. In November, Instacart picked Goldman Sachs to lead its IPO at a $30 billion valuation, Reuters announced. That would be a big leap from Instacart’s $17.7 post-money valuation secured in October with a new funding round of $200 million. In a tweet, during the COVID-19 pandemic, UFCW International President Marc Perrone called these employees a lifeline and called on Instacart to avert such plans to fire them.