Grocery delivery company Instacart has agreed to fork over $11 million to settle allegations that it has been nickel and diming its California workers.
The San Francisco company’s workers were notified of the payment earlier this week tied to a class-action lawsuit filed in Los Angeles state court in December 2017.
The lawsuit claimed Instacart broke California labor laws by not reimbursing drivers for costs they racked up using their own vehicles for deliveries.
The settlement also calls for Instacart to start paying its California drivers more based on the number of miles they drive for each delivery, as well as the weight and quantity of the items they are transporting.
“Our main claim is that these drivers have been asked to cover their own expenses, which comes out of their paycheck,” labor attorney Shannon Liss-Riordan, who represented the workers, told The Post.
The settlement comes as Instacart — valued at $7 billion — faces a worker strike planned for next month by a group of drivers and shoppers, according to a Medium blog post. The strike, to take place from Nov. 3 to 5, aims to make the company restore its former tipping policy.
Instacart workers have been mobilizing over the past year, fueled by anger over their diminished income due to complicated algorithms that determine their rate of pay.
“They are stealing tips,” Instacart worker Matthew Telles told The Post. “And we are going to move forward with more lawsuits and lobby more congress members.”
“All of these gig-economy companies are saving on their labor costs by classifying their workers as contract workers,” said Liss-Riordan, who has litigated cases against companies such as Uber, and who is running for a US Senate seat in Massachusetts.
Instacart, which did not respond to queries for comment, denied that it violated the law as part of the settlement.