Instacart is laying off every employee who voted to unionize, Motherboard reports. The news comes as the company shuts down in-store operations at some grocery stores amid the coronavirus pandemic and doubles down on curbside pickups.
The layoffs impact 10 unionized workers at a grocery store called Mariano’s, in addition to other Instacart employees. The group in Skokie, Illinois, a suburb of Chicago, voted to unionize last year with the United Food and Commercial Workers Local 1546 (UFCW). It was a landmark victory for gig workers and represented “the first time employees of tech companies that rely predominantly on contract labor have formed a union to collectively bargain for better wages, benefits, and working conditions,” according to my colleague Nick Statt.
Employees were in the process of negotiating their first contract when news of the layoffs hit. “These layoffs are totally discouraging for any gig workers who are trying to do something to make these jobs better,” one unionized worker told Motherboard. They said they were fighting for health insurance and vacation time in their initial contract.
UFCW told Motherboard the layoffs will impact nearly 2,000 of the company’s 10,000 grocery store workers.
The news could have a chilling effect on other organizing efforts by Instacart employees across the country. The company’s leadership has already shown its hostility toward organizers, running a union-busting campaign that included bringing in managers to the grocery store in Skokie to convince workers to vote against the union.
Although the pandemic has changed the company’s in-store shopping model, it’s also brought a significant increase in demand for grocery delivery. This year, Instacart plans to go public, an event that could value the company at roughly $30 billion.
The company announced the layoffs in a blog post about new grocery pickup models. Instacart said it would transfer some of the impacted shoppers to other grocery stores and provide “transition assistance” to people looking for work. “We know this is an incredibly challenging time for many as we move through the COVID-19 crisis, and we’re doing everything we can to support in-store shoppers through this transition,” the blog post says.
According to Motherboard, workers could get as little as $250 in severance.
Instacart would not tell The Verge whether the union employees would be among those getting transferred. The layoffs are scheduled to happen between March and June, according to Motherboard.
In a statement emailed to The Verge, an Instacart spokesperson wrote:
As a result of some grocers transitioning to a Partner Pick model, we’ll be winding down our in-store operations at select retailer locations over the coming months. We know this is an incredibly challenging time for many as we move through the COVID-19 crisis, and we’re doing everything we can to support in-store shoppers through this transition. This includes transferring impacted shoppers to other retailer locations where we have Instacart in-store shopper roles open, working closely with our retail partners to hire impacted shoppers for roles they’re looking to fill, and providing shoppers with transition assistance as they explore new work opportunities. We’re also providing all impacted shoppers with separation packages based on their tenure with Instacart.
The statement was pulled directly from the company’s public blog post.