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New documents challenge Instacart’s claim that workers get 100% of tips

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Grocery-delivery service Instacart has had an increasingly contentious relationship with its drivers in recent months, beginning with changes to its payment algorithm in November that some workers say have resulted in lower compensation. But the most explosive issue is a claim that the company is not honoring its well-advertised pledge to give 100% of customers’ tips to drivers.

Instead, say drivers, Instacart factors the expected tip amount into the calculation of the fee it provides, called the “batch incentive,” so that drivers get as many jobs paying a minimal $10 fee as possible. In short, some drivers claim, Instacart lowers the batch payment, which comes out of its own pocket, when customers tip more–keeping overall compensation lower than if 100% of the tip really went to the driver.

Instacart counters with the exact opposite, asserting that it raises the batch payment when customers tip less, to ensure that drivers earn at least $10 on every job.

It’s difficult to prove or refute either claim, due to all the variables in calculating the batch payment for each order under a new algorithm, rolled out nationally in November after months of consultation with Instacart’s contract delivery workers, known as shoppers.

Variables in the new payment calculation include the number of products, the weight of each product, and even the store they come from. Instacart also adds a separate fee based on mileage, plus occasional extras like a “quality bonus” for a 5-star customer review. Another wrinkle: some gigs require the contractors to shop for and deliver the orders, while others require only delivering orders packed by in-store Instacart employees.

Drivers have shown receipts to Fast Company that compare roughly similar orders,........

© Fast Company