Workers Join Senators in Calling for Investigation Into Instacart’s Tip Practices
Today Senators Brian Schatz, Elizabeth Warren, Sherrod Brown, and Chris Van Hollen published two letters calling for an investigation into Instacart and other delivery services’ deceptive acts around the issue of tip-baiting. We commend their call to action and join their demand for an investigation into Instacart’s unethical tipping practices.
Instacart has a well-established history of manipulative and unfair tipping practices, including reducing default tip amounts, misappropriating and withholding tips, utilizing tips to offset and reduce Instacart’s contributions to shopper compensation, and allowing customers to zero-out or modify their tip for a full 72 hours post-delivery.
Instacart knows full well that most customers will tip the default percentage established by Instacart, and still, in April 2018, Instacart cut tip defaults from a universal 10% to 5%. Industry standards for tips typically start at 15%, (GrubHub, DoorDash, UberEats) with some services defaulting to minimums of 20%. Shoppers have voiced grievances and organized walk-offs in attempts to get Instacart to raise default tip amounts. Instacart President, Nilam Ganenthiran, responded by defending 5% tip defaults, stating that Instacart should not be held to the same standards as their competitors when it comes to tips.
During this pandemic, Shoppers are already at a disadvantage as tips regularly default to a percentage of the receipt total. When a Shopper finds that an order has items that are out of stock, this subtracts from the final order total, and by extension, reduces the default tip amount. Because there is no visibility into what is actually out of stock, the person who is hurt the most is the Shopper because they end up wasting their time and receiving lowered pay. This is a technical problem that Instacart — a huge company that claims to be prosperous — could fix, but refuses to fix.
Instacart has failed to so much as even temporarily enforce more rigorous protections for Shoppers’ earnings during this pandemic. Tip reductions always result in lowered earnings for Shoppers, but it is especially egregious that it is happening now when Shoppers are facing unprecedented risks in the course of our work.
In addition to full support for an FTC investigation into Instacart over tip-baiting, we make the following demands of Instacart:
- Shorten the window for customers to revise tips from 72 hours to 3 hours.
- Tip reductions must be capped at 50% in all markets.
- Tips must default to at least 10% universally on all orders.
Thank you to Senators Brian Schatz, Elizabeth Warren, Sherrod Brown, and Chris Van Hollen for amplifying the grievances of workers and calling for an FTC investigation into Instacart’s actions.