24 ms·

Instacart and DoorDash’s Tip Policies Are Delivering Outrage

344 points by tysone 8y ago

jonknee 8y ago
The kick of the plot here is to not tip on Instacart as you're just handing money to VCs. Or maybe give the driver cash?
- giancarlostoro 8y ago
  > Or maybe give the driver cash? "Gross. Who carries cash anymore?" Future headline: Millenials are killing physical cash. Jokes aside (as a millennial) this is not something I usually have readily available. I try to keep all my transactions digital but I may take money out just for tipping purposes.
  - itronitron 8y ago
    In that case I recommend that you go to your bank and make a cash withdrawal in the form of $2 bills. That way you can be cool when handing out cash tips.
    - irrational 8y ago
      I do all my banking online. My bank doesn't have any local branches. Seriously, who has cash anymore?
      - jonknee 8y ago
        There is a worldwide network of machines that do nothing but give cash out from your bank account. Judging by the number of them I'd wager that almost everyone has cash.
    - AimForTheBushes 8y ago
      Hi grandma!
  - excitom 8y ago
    This is exactly why I keep some small bills in my wallet. No need for the "man" to share the transaction between me and the person who provided me with good service.
  - smichel17 8y ago
    As another millennial, I carry cash and pay with it whenever possible, though I think I'm in the minority on the latter point (but not the former!).
    - giancarlostoro 8y ago
      My cousin does the same thing, also a millennial. She carries all her money though.
  - Apocryphon 8y ago
    To play into other stereotypes, plenty of hidden gem hole-in-the-wall restaurants in ethnic enclaves or overlooked neighborhoods that millennial like to Yelp about are cash-only.
- gotocake 8y ago
  Better yet, accept that these business models are a cancer, and refuse to support them with your custom.
- dragonwriter 8y ago
  Why would you tip on any service where you are already literally paying for the service of delivery? It's like tipping has become completely divorced from any purpose.
  - RexetBlell 8y ago
    Completely agree.
  - deleted 8y ago
    [deleted]
  - choward 8y ago
    It's basically just a way for businesses to advertise a lower price than the actual price which in turn leads to more profit. Tipping doesn't benefit workers or customers. It only benefits businesses. It needs to be abolished.
  - pkaye 8y ago
    When this is brought up in other conversations, the servers usually prefer tips because they don't trust the employer to not screw them over on pay. Secondly they can get a lot higher effective pay with tips than with straight pay. In the end the kitchen staff gets screwed but that is not the servers problem. Employers prefer tipping because they can advertise a lower price. Secondly tips are effectively a per customer payment vs a wage being hourly. So in times of few customers, the labor costs are lower on the employer.
crushcrashcrush 8y ago
This is a great example in my opinion of the apathy we need to combat as technologists. Why did NO ONE in any meetings when designing this "feature" or process say anything? "This is wrong/greedy/will have blowback." No one voiced concerns? Or, more specifically, if they did, no one listened? They didn't think this would leak out, with all the hatred regarding wage stagnation, income inequality, corporate greed? A marketing pro, PR specialist, or frankly anyone in touch with culture and human beings would have throw up a flare that this is a terrible idea. What is going on with culture at these companies?
- jonknee 8y ago
  > Why did NO ONE in any meetings when designing this "feature" or process say anything? Who's to say someone didn't? All we know is they decided to steal tips, not that everyone thought it was a great idea.
  - crushcrashcrush 8y ago
    I address that later in my comment... Is this a function of schooling? MBA programs? Corporatism?
    - jonknee 8y ago
      The Excel models all look a lot nicer if you take the tips!
    - airstrike 8y ago
      As an MBA, I really take issue with this cynicism of MBA programs. It's not like we're cold greedy bastards. Stop generalizing. People can make great and terrible decisions, regardless of grad school degree choice.
      - resters 8y ago
        Hah. Well it's obviously a case where the consumer habit of tipping for delivery means that on a $100 order there may be $105 that the customer is willing to (or used to having to) pay. Thus leaving that $5 on the table is perhaps a stupid business decision. I should hope an MBA would point that out, so long as another MBA pointed out that the user experience may be more important than the few extra dollars.
ForHackernews 8y ago
Always tip cash to service people. http://tipthepizzaguy.com/ http://tipthepizzaguy.com/
- rconti 8y ago
  I question the premise of the page: people don't know you're supposed to tip your driver? I got my hair cut the other day, and asked my stylist about this; she doesn't really care cash versus CC, HOWEVER, she uses Square (or similar), and if you tip on your card, it's automatically rolled into the 1099; there's no way to have non-taxed tips.
- sevenf0ur 8y ago
  > Always tip cash to service people. It's more nuanced than that. Do you tip pest control, plumbers, locksmiths, that guy that fixes the spring in your garage opener? As a consumer, I'd rather pay a fixed price and not worry about carrying enough cash to supplement their income.
  - ForHackernews 8y ago
    I would say pest control, plumbers and locksmiths are skilled professional craftsmen who command a high market rate for their labour. I don't consider those "service" jobs. At any rate, yes, the tipping system is stupid, but you're not taking a bold stand against it by stiffing some poor chumps making less than minimum wage.
chaboud 8y ago
I have a simple answer: I will never use Instacart or Doordash again, ever. Even if they change their policy, they are dead to me as companies, and any company that acquires them is similarly dead to me. If you're out there, upstart disruptors, know that pulling stuff like this will cost you at least one customer for life. I'm sure that there are more people like me.
- mhb 8y ago
  Instacart workers have urged customers not to boycott the company, which would cut even further into their earnings.
  - mikeash 8y ago
    Domestic violence victim urges police not to arrest spouse, as it will only make them angrier.
  - dawhizkid 8y ago
    this is depressing
  - onemoresoop 8y ago
    Instacart workers should not allow themselves bullied to this point.
  - CydeWeys 8y ago
    There's plenty of former employees who've left issues with low pay and these policies. I'd rather show solidarity with them by not supporting their exploitative former employer.
  - chaboud 8y ago
    Those Instacart workers can go drive for the other companies that will get my business. I'm not skipping out on grocery and food delivery. I'm voting for good behavior with my wallet. Note: I recognize the same people driving for different services pretty regularly.
duxup 8y ago
It's terrible, but really it fits what these businesses do fundamentally. They provide a service, and and push as much risk off of the copany and onto their contractors as possible. Slow sales? Contractor just doesn't get paid. Injury? Contractor's problem, he's gone, who is next? The idea that they'd dip into the pot further to ensure more money for the company isn't much different than the rest of the risk they put onto the contractors. It's not right, but it is how these companies operate fundamentally.
- crushcrashcrush 8y ago
  When the pendulum swings very-left (as it will, American politics follow a tick-tock partisan pattern) I believe someone (AOC?) will crack down on "contractor" companies - they're not paying payroll taxes. Not a good thing.
  - 0xffff2 8y ago
    What's to crack down on exactly? The government still gets all its taxes. It just gets all of it from the employee (sorry, "contractor") rather than getting half each from the employee and employer.
    - duxup 8y ago
      In this case the employee is getting paid potentially paid "less" so wouldn't that men less taxes on that end? I'm not sure that tax payment by say a random start up or given to en employee would necessarily be 1:1. Netflix made big profits, but paid little tax, if they had paid it as salary (obviously not going to happen) I bet there would be more tax revenue. And that's just assuming the objections are about tax revenue... they're not.
    - EpicEng 8y ago
      "Crack down" doesn't necessarily mean "they're doing something illegal _today_." They could certainly go after the contractor laws and change them. It's not all taxes; many protections employees get are skirted via these gig job companies due to everyone being a contractor.
skrowl 8y ago
Just tip $0 in the app and tip in cash, just like Uber / Lyft
- paulgb 8y ago
  Speaking of Uber/Lyft, do we have any verification that they aren't doing this? I would expect them to take a 2-3% cut to cover the card processing cost but hope that the rest goes to the driver.
  - greenleafjacob 8y ago
    Service fees are not charged on tips to drivers [1]. [1] https://www.uber.com/drive/partner-app/how-tips-work/ https://www.uber.com/drive/partner-app/how-tips-work/
- irrational 8y ago
  What is this cash you speak of? I jest, but seriously, it has been more than a decade since I last had cash on me. I assume there is someway that I could get cash, but it has been so long I'm probably (okay, definitely) not going to go to the trouble. Saying I should tip them in cash is saying that I shouldn't tip them.
  - walls 8y ago
    Stop at a bank every six months and pick up a few fives, it's really not that complicated.
  - metildaa 8y ago
    Seriously? Your going to claim to not know of the existence of ATMs or cash back at most grocery stores/7-Elevens? If this is actually your world, I hate to think of the places you'll be constrained to, especially in the US. Seattle is an oddity on the West Coast being card friendly, and from what I gather New York is a cash based economy like most of SoCal.
  - ionised 8y ago
    This is the most ridiculous thing I've heard in a while. There are ATM's all over the god damn place.
resters 8y ago
Why doesn't this problem exist when I order something from Amazon? Because there is no absurd idea that I should be tipping the UPS guy or anyone else involved in fulfilling my order. It makes much more sense for InstaCart to simply collect star ratings and offer bonuses for the employees who are going above and beyond. Considering how often the shopper has to call me about replacements, parking outside my building, etc., Instacart should be focusing on fixing the inventory issues and logistical issues, not trying to shame me into paying its employee an extra $5 at every turn. Instacart charges for delivery and often marks up the prices of the items. I don't like being shaken down via a default tip when trying to check out. It's extremely irritating!
- bluedino 8y ago
  It's not uncommon to tip your UPS/FedEx delivery person, or your USPS carrier. At least around the holidays.
  - maxxxxx 8y ago
    The tip you give to the UPS driver is a real tip for good service, not a necessary wage supplement to keep them from starving.
    - megy 8y ago
      How is it good service? Does the driver have any control over the traffic?
      - maxxxxx 8y ago
        I often meet the driver. Some of them are nicer than others.
  - wuliwong 8y ago
    I would guess that the ratio of the number of tips to the number of deliveries for UPS/FedEx/USPS is orders of magnitude lower than for Instacart/DoorDash/etc.
ummonk 8y ago
I've always found this practice outrageous but don't understand why everyone else is only getting outraged now that Instacart and DoorDash do it... This is pretty normal in the restaurant and food delivery industry, and should have been made illegal ages ago.
- Jordrok 8y ago
  This is the exact thought I had when I read the article. I never understood how or why this practice was legal in the first place, but it sounds almost identical to what Instacart and DoorDash are doing. People SHOULD be outraged!
- gamblor956 8y ago
  That is actually not normal in the restaurant industry. In restaurants, tipped workers get a base wage and earn tips on top of that. If they don't hit minimum wage from that base wage+tips, the restaurant has to pay them so they at least make minimum wage. If you have an issue with the low base wage, take it up with your local legislature. InstaCart and DoorDash are doing something different: they're promising a minimum payment to drivers but that minimum payment is in lieu of a tip. A or B, not A+B=C.
projectileboy 8y ago
Once upon a time, folks would have organized a union and fought for their rights. But I realize that's not very innovative or disruptive, or libertarian or capitalist or whatever the hell the overriding ethos seems to be in Silicon Valley.
pastor_elm 8y ago
200 dollars a day delivering packages? Yeah, that's not going to last, sorry.
- saagarjha 8y ago
  Do you think they should be getting more or less?
  - EpicEng 8y ago
    Less, obviously.
40acres 8y ago
I think the fact that a gig economy company with fair (for lack of a better term) labor practices hasn't shown up yet (to my knowledge) is an indictment on the lack of vision from VCs and entrepreneurs. As a recent NYT article showed, we are moving towards a bifurcated economy split between service workers and high skilled work based on technology. The gig economy has the correct foresight in merging the two but due to the shortsighted nature of VCs these companies have built a business model based on worker exploitation. It's hard to believe that a balance does not exist that would allow for a "gig" company to utilize full-time workers and still be profitable.
- maxxxxx 8y ago
  I thought the gig economy is about getting rid of burdensome things like paying employees regularly and reliably, or maintaining a fleet of vehicles, or health insurance and then putting the money into the pockets of the company. "It's hard to believe that a balance does not exist that would allow for a "gig" company to utilize full-time workers and still be profitable." Your plumbing business does it, also cleaning companies and most other service businesses. The gig companies can be more profitable because they take shortcuts.
- SkyPuncher 8y ago
  > I think the fact that a gig economy company with fair (for lack of a better term) labor practices hasn't shown up yet (to my knowledge) is an indictment on the lack of vision from VCs and entrepreneurs. IMO, The "fair" gig economies are inversely correlated with their broadness and accessibility. Uber, Lyft, Doordash, Shipt, etc will never be fair because so many people are able (and willing) to race to the bottom. Things requiring specialized skills generally seem relatively fair. They tend to pay less than a normal job, but still well above minimum wage. That's a fair tradeoff for the flexibility they come with. It's much better than the alternative of not having any options. Tutoring, tech support, care giving, nursing, and more have successful gig economy companies that offer people a way to easily make additional income.
- kevin_b_er 8y ago
  > I think the fact that a gig economy company with fair (for lack of a better term) labor practices hasn't shown up yet (to my knowledge) is an indictment on the lack of vision from VCs and entrepreneurs. Their vision is likely well aligned. The gig economy metes out little bits of work to a new underclass, while shifting nearly all risk onto them. This improves profit flow. The gig economy bypasses the American Labor Movement. The mandatory binding arbitration bypasses the Rule of Law. The VC's vision is excellent. They extract work out people who don't have much recourse, except they've figured out slavery isn't needed. You just need them hopeless enough to work for nothing, because they can't get anything else. Since they don't need to be paid minimum wage, they don't get benefits, and you can nickle and dime them because you've bypassed the rule of law, you get a lot of advantages over a normal company that has to play by the classic rules of treating humans with any kind of dignity and the laws they got passed to do so. The app concept makes things faceless so the company can make profit by making someone else do the hard work and take the risks.
a-wu 8y ago
DoorDash is extremely helpful for me because I'm disabled and can't cook so it's really convenient for me to be able to order food for delivery when I don't have a caregiver around to cook food for me. I'm extremely disappointed by DoorDash's policies but because of my circumstances I can't just boycott. I live in a college town too, so most DoorDash drivers are students who are just barely getting by, so I'll be tipping my drivers in cash from now.
- starpucks 8y ago
  Uh huh
- newfriend 8y ago
  There are plenty of other delivery services. Grubhub, UberEats, and Caviar are a few off the top of my head.
  - a-wu 8y ago
    UberEats/Grubhub don't have the same selection of restaurants in my area and I'm really not sure how much I trust them to not pull this same thing either. I will definitely try to order from those services if available but I'll probably still tip in cash.
    - blueline 8y ago
      if ubereats works the same as uber then 100% of the tip actually does go to the worker
- darkpuma 8y ago
  You should call your local grocery store and see if they have a delivery program. Many if not most do, although it's typically poorly advertised or unadvertised. You can have them deliver prepared food from the store.
  - a-wu 8y ago
    Unfortunately the one local grocery store that does have the service runs it through Instacart anyway.
bluedino 8y ago
These services need a Robin Hood hacker to take pennies or dollars from the transactions going to the Instacart bank accounts, and the executives back accounts, and disburse them equally to the workers.
fipple 8y ago
The minute I figured out you can adjust the Instacart fee to zero I did, and leave a fiver for the delivery person.
pithymaxim 8y ago
>Instacart and DoorDash...have figured out a clever way to use customer tips to lower their labor expenses. Isn't this how restaurants work..?
- alistairSH 8y ago
  Similar, but not exactly the same. In the case of wait staff, the pay system is well known and regulated (see below). In the case of the gig workers, it appears to be up to the employer, unregulated, and not well documented. In the restaurant industry, a waiter must be paid the standard minimum wage (for the state/city/etc). However, because tips are expected, the employer is allowed to pay less IF AND ONLY IF the tips make up the difference. Made up example: State min. wage: $10/hour State adjusted min. for wait staff: $5/hour Tips per hour: $6/hour Actual pay: $11/hour ($5 adjusted + $6 tips) Tips per hour: $3/hour Actual pay: $10/hour ($3 tips + $7 pay)
  - alistairSH 8y ago
    In the gig economy, that $5/hour adjust minimum might not exit (because it's not regulated), so the scenarios becomes... Made up example: Employer-stated hourly rate: $10/hour Tips per hour: $9/hour Actual pay: $10/hour ($9 tips + $1 pay) Tips per hour: $3/hour Actual pay: $10/hour ($3 tips + $7 pay) And in the very extreme case... Tips per hour: $11/hour Actual pay: $11/hour ($11 tips + $0 pay) By avoiding the minimum wage, and backfilling wages with tips, the employer can theoretically avoid paying ANY wages to employees (and I'm specifically calling them employees here because I believe most of these gig economy jobs should be employees, even if not legally required to do so).
- rconti 8y ago
  Yes, but whether or not you think it's immoral, it's legal, and it's codified. Which is different from DoorDash lying to you when they say "100% of the tip goes to your Dasher".
nightcracker 8y ago
Is this legal? Taking tips or paying less to offset tips is theft. I smell a class-action lawsuit.
russellbeattie 8y ago
This is wage theft, but the fact is even with this negative publicity these companies will continue to steal tips from now on. This isn't the first news report about it, but DoorDash and Instacart obviously don't care. They're not so dumb as to not realize how this might be a public relations 'challenge'. They realized it would be seen negatively, did the math, and decided that the general public would be apathetic and the supply of people desperate for work would continue to provide them with enough deliverers regardless of how badly they treat them. The only solution to this is legislative. The whole 'gig' economy is capitalism gone mad, where large corporations take advantage of the most vulnerable people in society for cheap labor without benefits or stability. Governments need to crack down on this before it gets bigger than it already is.
curiousgeorgio 8y ago
Or, avoid the whole problem by eliminating tipping altogether (please!). Charge a fair and honest price where you can compensate contract workers enough to incentivize them to work for you in the first place (no surprises), and customers will appreciate not feeling the pressure to figure out what an appropriate tip might be. Use feedback/ratings to reward exceptional service. As an added bonus, you eliminate the discriminatory problems of certain classes of people earning more tips than others for reasons unrelated to service.
rconti 8y ago
I've never used Instacart, but I've used GrubHub and DoorDash and the like a couple of times -- I can never remember which one I have an account for, or which one has the restaurant I want, so it's always a hodgepodge. But one thing is clear as day. When I use DoorDash, the tip box says "100% of tip goes to Dasher". Look, I know all of these places either charge me a service fee, or if I'm not being charged a service fee, they're marking up the food over list price AND getting a discount from the restaurant for the extra volume generated by the company. FINE. But when you tell me 100% of my tip goes to the tippee and then you take money out of their pay because I tipped them, that is fraud. Money is a fungible good. It doesn't matter that "my" money went to the Dasher, and you took "your" money from them. In fact, that's not even true, because it's all in one CC transaction anyway. 100% of my tip did NOT go to the Dasher.
- cannonedhamster 8y ago
  This is a good point and likely going to result in a massive class action that a few of these companies don't survive.
  - smt88 8y ago
    They'll survive it. The pendulum has swung far toward corporations and awards don't tend to be death sentences these days. What other company has been killed by a lawsuit lately, other than thorough frauds like for-profit colleges?
    - unknownkadath 8y ago
      Well, there's Gawker, but that's also a special case. PG&E?
  - techsupporter 8y ago
    DoorDash has a mandatory arbitration clause (that I opted out of but most people don’t) so I fear the best we can hope for is a light tap from a state AG and a flimsy promise to “review our internal procedures” with no big change. It isn’t as though large numbers of people will stop using these services that deliberately abuse their “independent contractor” workers.
AlexandrB 8y ago
Not to be pedantic, but why isn't "Instacart" being annotated as "Instacart (YC S12)" in this latest round of stories? Seems only fair.
- jameslevy 8y ago
  You don't see this for the YC startups that have become very mainstream. Reddit is mentioned on a front page HN headline right now (https://news.ycombinator.com/item?id=19087558 https://news.ycombinator.com/item?id=19087558) without mention of its batch.
  - lucb1e 8y ago
    This is the second time I heard of instacart and it took me a minute to remember what they do (and the first time I heard of doordash), but reddit is much more well-known. Not sure it's that they're so commonplace.
- randycupertino 8y ago
  They generally only do that on positive-spin articles, not the negative or bad PR ones.
sfilargi 8y ago
Simple way to beat their system: Always enter $0 as tip in their app and the tip the driver with cash or your favorite money app
towelr34dy 8y ago
"Tipping Policies" "deceptive tipping policies" Huh... Somehow I think if I set up a tipping jar for the government and kept the majority of the funds, it would be quickly called 'stealing'. Actually, I think in California since the amount is over $10k, it's grand theft. Welcome to the era of legislative capture, when the criminal activities of a corporation are discovered, "journalists" frame the situation as "big company make mistake, people get upset, people should figure it out and want transparency" and then seem to want to compare this to our outrage culture. lol What transparency could you trust from someone who stole from you? Outrage seems to carry a connotation of being a bit of an overreaction. And a strong reaction. People aren't hurling insults because of this. They are angry. And rightfully so. They were stolen from. The article makes no sense unless you believe it was a 'mistake of deceptive practices'. There's not even a single mention of restitution or ANYTHING that wouldn't have been approved by a corporate PR team in an effort to appear 'unbiased'. If crack dealers had this type of coverage, we'd be hearing about 'Possible loud sounds that could be confused with guns that happen when certain issues arise. Maybe we should ask for transparency to see what is going on?'
- sitkack 8y ago
  Baffler quality truth right here.
qiqing 8y ago
Excerpt: "Some are asking for cash tips outside the app, while others are encouraging customers to leave 22-cent tips — a nominal amount meant to show solidarity with workers — through the app and then adjust the tips higher after a delivery has been made." I think I might do that from now on.
stephenitis 8y ago
Are Wag and Rover doing this also?
minimaxir 8y ago
Just in: the policy is now being ended: https://www.buzzfeednews.com/article/carolineodonovan/after-scrutiny-instacart-will-end-its-controversial-tipping https://www.buzzfeednews.com/article/carolineodonovan/after-... > “Based on your feedback, today we’re launching new measures to more fairly and competitively compensate all our shoppers,” Mehta wrote. “Tips should always be separate from Instacart’s contribution to shopper compensation.” > Instacart also said it will compensate workers affected by the previously policy. “For example, if a shopper was paid $6 by Instacart, to compensate for our mistake, he or she will receive an additional $4 from Instacart,” Mehta wrote.
- FPGAhacker 8y ago
  going back how far? I'll believe it when I see it.
- AlexandrB 8y ago
  But they're cutting shopper compensation at the same time! > In addition, Instacart also said it would adjust the minimum pay per delivery to between $7 and $10 for deliveries for which the driver buys and delivers the groceries, and $5 for delivery-only jobs. Previously, Instacart guaranteed $10 per delivery, but sometimes included customer tips in that amount. What shady behaviour! I'm guessing Instacart did the math on average tips and figured out that with a $5 delivery guarantee + tips shoppers would be back up to around $10 on average. Edit: Yup, that's exactly what happened. > “With an average tip of $5, our customers regularly recognize shoppers with tips for the services they provide."
deleted 8y ago
[deleted]
kartayyar 8y ago
I switched from Instacart to Goodeggs in large part because they say they pay their employees a fair wage and there is no option to tip.
BryanMMMM 8y ago
I remember Uber used to not encourage tipping. GrubHub and DoorDash should do the same thing, at least not encouraging, because tipping would cause more confusions for services like those.
supernova87a 8y ago
What I hate about company behavior is the lack of leadership compass in knowing what is right and wrong, and instead treating every resource (person) as an experiment to see what they'll accept or not. And if they don't hear enough complaints, must've been ok to do. You can read it in their apologies and the positive spin: "We heard loud and clear the frustration when your compensation didn’t match the effort you put forth." Heard you loud and clear? What is this, like the American Idol voting contest? Daytime Emmy awards, or public opinion poll, where we have to be asked what we like to be paid? A proper apology would be: "We know what we were doing was wrong, and we were wrong to do it, and we will not do things like that in the future." Not, "it seems you didn't like what we did, so we'll do something different." Makes you think they won't apologize for doing fundamentally wrong things until they get called out by public opinion. What types of issues should a company know are not ok / illegal, and what issues are subject to public approval or measuring reception? Shouldn't a CEO know these and apologize accordingly? Or maybe that is the role of regulation and government to keep the amoral corporate compass calibrated.
- ilaksh 8y ago
  It seems to me like the CEO should be fired. Not even from a moral perspective but just from a PR perspective.
mirimir 8y ago
Why don't users just tip with cash? If you're a regular user, it's not such a big deal to have some small bills around. Traditionally, I always tipped in cash, in case people wanted to keep their tips private.
pseudolus 8y ago
Instacart has apparently just reversed its policy. Sometimes outrage does work. https://www.nytimes.com/2019/02/06/business/instacart-tipping.html https://www.nytimes.com/2019/02/06/business/instacart-tippin...
ggm 8y ago
Unions and minimum wages and an end to tipping culture. Anything else is amelioration not really fixing it.
xster 8y ago
> while others are encouraging customers to leave 22-cent tips — a nominal amount meant to show solidarity with workers — through the app and then adjust the tips higher after a delivery has been made This seems like a strangely optimistic assumption to make. I'd imagine it'd be really easy for instacart to batch shopper's payments and retroactively credit or debit the shopper's account to always pay a minimum total depending on the tip.
gumby 8y ago
Too late: I now know how the company thinks about its employees and, frankly how truthful they are with their customers too. So more Instacart and no more DoorDash for me. Simply uninstalling the app won't cause change, so I contacted both Instacart and DoorDash and asked them to delete my account and all PII and when asked, explained why. There are plenty of alternatives to both and I suspect we'll pretty quickly figure out which ones are the creepy assholes and which differentiate themselves by being decent human beings. For that matter, it's worth looking at which investors have supported this kind of attitude, as I'm sure this was discussed in board meetings.
habosa 8y ago
Onoe way you can tell this was no "mistake" is because both companies did it (and probably others). This was industry-wide wage theft in the pursuit of profit.
coffee 8y ago
> ...couriers have braved the elements, gotten by on meager wages and dealt with annoying customers, growling dogs and fifth-floor walk-ups, all for the chance of a big tip from a happy customer. This is not how I experience it working, in my area, with sites like GrubHub and the others. They ask for a tip UPFRONT, before delivery. I usually like to tip cash (for obvious reasons). There is an option for this, and the problem starts when I select this option. My food takes an extra 1+ hour to arrive. It's cold. Soggy. My family has been waiting for around 2 hours total. Interestingly... This NEVER happens when I tip upfront through the app. Complaining to their support line never fixes the issue, so I started asking the delivery drivers about this. What did they say? Apparently, the app flashes the delivery drivers how much tip you've entered BEFORE they decide to take on your delivery. So my order, when I pay a cash tip, simply doesn't get picked up by any delivery driver and it's at the restaurant getting cold and soggy. When I tip upfront, it gets delivered in a normal timeframe. I tested giving a BIG tip upfront, guess what? My order came faster than it ever has in the past. I asked the driver and he flat out told me he saw the big tip and rushed to grab this delivery.
- Game_Ender 8y ago
  This sounds like fine model to me, pay more, get faster service. The key should be transparency and a minimum service level, ie. they should lay enough by default that every order will get picked up.
  - coffee 8y ago
    It's really not a fine model, though. This isn't groceries, or a package from Amazon, this is hot food ready to serve that goes cold and soggy.
    - QuercusMax 8y ago
      Whole Foods (Amazon) grocery delivery has you tip the delivery person up-front. They still seem to screw up my order all the time. I mean, seriously, I KNOW they have the stuff on the shelves, but the delivery people flake out all the time and don't deliver half my order. What a scam.
ghostbrainalpha 8y ago
If you are wondering why these companies think they can get away this this...... Look at the number of comments here from people who are going to continue using these service, and work around the problem by tipping the driver cash. If you believe the leadership is amoral at a company, you have to be willing to walk away entirely or they will keep doing what they are doing.
randomacct3847 8y ago
Honestly makes me wonder if either of these services are long term sustainable without basically not paying the delivery workers. It’s less a case of two companies making huge profits being evil and greedy and more the case of two overfunded unicorns optimized for growth at all cost with bad unit economics and bleeding cash
atom_arranger 8y ago
The thing that's actually terrible is that there's tipping on Instacart in the first place. Uber didn't used to have tipping, it was added later. I'm not really sure why, it makes the experience as a user worse, I'm not interested in thinking about that, just pay the drivers Uber.
LumpLump 8y ago
I see a class action from customers. They gave a person money and it was stolen by a corporation. It is nothing less then thief. The drivers are not working for them so why should they be providing their base pay. Besides if that is the case, each customer should be providing a 1099 to the drivers based on IRS rules.
ag_dart 8y ago
Worked as a PM in one of these Gig companies. Almost all companies do this (Not saying that it's right or wrong). They way they frame it to 'contractors' is "We will make sure you get enough orders to earn $10 in 1 hour. Where that $10 comes from is not something that we care about. If the customers tip you, well there's your $10 dollars, if they don't we will cough up the requisite amount to match the guarantee". There is no such thing as Base Pay as we understand it in this business model.
lightedman 8y ago
When is YC going to be held accountable for the frauds they are bringing upon the population? Instacart is a YC-backed company, and I think it's time the people at the very top got held responsible for these frauds being perpetuated upon us. I really think Paul Graham should be getting sued, and sued hard. Time to bring real ethics back into the world of technology.
SkyMarshal 8y ago
Does anyone know if these delivery companies can survive in a higher interest rate environment? They were tried during the dotcom boom too and all of them went bust. I've assumed the goal in trying them again was 1) cheap money again, 2) better logistics tech so maybe they can make better margins this time, and 3) sell to another established company that can use them as a loss leader, or IPO and expand into other businesses, before rates inevitably rise again. Or do they think they have a viable business model even in a higher rate environment? They seem to be operating on slim margins, hence moves like this tip stealing stuff, or Instantcart's attempts to get customers to sign up for a subscription.
bparsons 8y ago
This is wage theft. These guys will get nailed in one or many of the jurisdictions they pulled this in.
deleted 8y ago
[deleted]
keerthiko 8y ago
Yet another article about tip outrage that skirts the issue of how culturally propping up universal service industry tipping is propagating and prolonging predatory wage labor by service providers and restaurants. It's in restaurant management and DoorDash's best interests to keep the tipping culture alive and well because they can continue to pay effectively sub-minimum wage by preserving the tip-based wage flexibility the US legally provides them. Oh well.
NicoJuicy 8y ago
If you paid with your credit card, can you do a chargeback? If you tipped, this seems like deceit. And according to me, a good reason for a chargeback

344 points by tysone 8y ago

The kick of the plot here is to not tip on Instacart as you're just handing money to VCs. Or maybe give the driver cash?

giancarlostoro 8y ago
> Or maybe give the driver cash? "Gross. Who carries cash anymore?" Future headline: Millenials are killing physical cash. Jokes aside (as a millennial) this is not something I usually have readily available. I try to keep all my transactions digital but I may take money out just for tipping purposes.
- itronitron 8y ago
  In that case I recommend that you go to your bank and make a cash withdrawal in the form of $2 bills. That way you can be cool when handing out cash tips.
  - irrational 8y ago
    I do all my banking online. My bank doesn't have any local branches. Seriously, who has cash anymore?
    - jonknee 8y ago
      There is a worldwide network of machines that do nothing but give cash out from your bank account. Judging by the number of them I'd wager that almost everyone has cash.
  - AimForTheBushes 8y ago
    Hi grandma!
- excitom 8y ago
  This is exactly why I keep some small bills in my wallet. No need for the "man" to share the transaction between me and the person who provided me with good service.
- smichel17 8y ago
  As another millennial, I carry cash and pay with it whenever possible, though I think I'm in the minority on the latter point (but not the former!).
  - giancarlostoro 8y ago
    My cousin does the same thing, also a millennial. She carries all her money though.
- Apocryphon 8y ago
  To play into other stereotypes, plenty of hidden gem hole-in-the-wall restaurants in ethnic enclaves or overlooked neighborhoods that millennial like to Yelp about are cash-only.
gotocake 8y ago
Better yet, accept that these business models are a cancer, and refuse to support them with your custom.
dragonwriter 8y ago
Why would you tip on any service where you are already literally paying for the service of delivery? It's like tipping has become completely divorced from any purpose.
- RexetBlell 8y ago
  Completely agree.
- deleted 8y ago
  [deleted]
- choward 8y ago
  It's basically just a way for businesses to advertise a lower price than the actual price which in turn leads to more profit. Tipping doesn't benefit workers or customers. It only benefits businesses. It needs to be abolished.
- pkaye 8y ago
  When this is brought up in other conversations, the servers usually prefer tips because they don't trust the employer to not screw them over on pay. Secondly they can get a lot higher effective pay with tips than with straight pay. In the end the kitchen staff gets screwed but that is not the servers problem. Employers prefer tipping because they can advertise a lower price. Secondly tips are effectively a per customer payment vs a wage being hourly. So in times of few customers, the labor costs are lower on the employer.

crushcrashcrush 8y ago

This is a great example in my opinion of the apathy we need to combat as technologists. Why did NO ONE in any meetings when designing this "feature" or process say anything? "This is wrong/greedy/will have blowback." No one voiced concerns? Or, more specifically, if they did, no one listened? They didn't think this would leak out, with all the hatred regarding wage stagnation, income inequality, corporate greed? A marketing pro, PR specialist, or frankly anyone in touch with culture and human beings would have throw up a flare that this is a terrible idea. What is going on with culture at these companies?

jonknee 8y ago
> Why did NO ONE in any meetings when designing this "feature" or process say anything? Who's to say someone didn't? All we know is they decided to steal tips, not that everyone thought it was a great idea.
- crushcrashcrush 8y ago
  I address that later in my comment... Is this a function of schooling? MBA programs? Corporatism?
  - jonknee 8y ago
    The Excel models all look a lot nicer if you take the tips!
  - airstrike 8y ago
    As an MBA, I really take issue with this cynicism of MBA programs. It's not like we're cold greedy bastards. Stop generalizing. People can make great and terrible decisions, regardless of grad school degree choice.
    - resters 8y ago
      Hah. Well it's obviously a case where the consumer habit of tipping for delivery means that on a $100 order there may be $105 that the customer is willing to (or used to having to) pay. Thus leaving that $5 on the table is perhaps a stupid business decision. I should hope an MBA would point that out, so long as another MBA pointed out that the user experience may be more important than the few extra dollars.

ForHackernews 8y ago

Always tip cash to service people. http://tipthepizzaguy.com/ http://tipthepizzaguy.com/

rconti 8y ago
I question the premise of the page: people don't know you're supposed to tip your driver? I got my hair cut the other day, and asked my stylist about this; she doesn't really care cash versus CC, HOWEVER, she uses Square (or similar), and if you tip on your card, it's automatically rolled into the 1099; there's no way to have non-taxed tips.
sevenf0ur 8y ago
> Always tip cash to service people. It's more nuanced than that. Do you tip pest control, plumbers, locksmiths, that guy that fixes the spring in your garage opener? As a consumer, I'd rather pay a fixed price and not worry about carrying enough cash to supplement their income.
- ForHackernews 8y ago
  I would say pest control, plumbers and locksmiths are skilled professional craftsmen who command a high market rate for their labour. I don't consider those "service" jobs. At any rate, yes, the tipping system is stupid, but you're not taking a bold stand against it by stiffing some poor chumps making less than minimum wage.

chaboud 8y ago

I have a simple answer: I will never use Instacart or Doordash again, ever. Even if they change their policy, they are dead to me as companies, and any company that acquires them is similarly dead to me. If you're out there, upstart disruptors, know that pulling stuff like this will cost you at least one customer for life. I'm sure that there are more people like me.

mhb 8y ago
Instacart workers have urged customers not to boycott the company, which would cut even further into their earnings.
- mikeash 8y ago
  Domestic violence victim urges police not to arrest spouse, as it will only make them angrier.
- dawhizkid 8y ago
  this is depressing
- onemoresoop 8y ago
  Instacart workers should not allow themselves bullied to this point.
- CydeWeys 8y ago
  There's plenty of former employees who've left issues with low pay and these policies. I'd rather show solidarity with them by not supporting their exploitative former employer.
- chaboud 8y ago
  Those Instacart workers can go drive for the other companies that will get my business. I'm not skipping out on grocery and food delivery. I'm voting for good behavior with my wallet. Note: I recognize the same people driving for different services pretty regularly.

duxup 8y ago

It's terrible, but really it fits what these businesses do fundamentally. They provide a service, and and push as much risk off of the copany and onto their contractors as possible. Slow sales? Contractor just doesn't get paid. Injury? Contractor's problem, he's gone, who is next? The idea that they'd dip into the pot further to ensure more money for the company isn't much different than the rest of the risk they put onto the contractors. It's not right, but it is how these companies operate fundamentally.

crushcrashcrush 8y ago
When the pendulum swings very-left (as it will, American politics follow a tick-tock partisan pattern) I believe someone (AOC?) will crack down on "contractor" companies - they're not paying payroll taxes. Not a good thing.
- 0xffff2 8y ago
  What's to crack down on exactly? The government still gets all its taxes. It just gets all of it from the employee (sorry, "contractor") rather than getting half each from the employee and employer.
  - duxup 8y ago
    In this case the employee is getting paid potentially paid "less" so wouldn't that men less taxes on that end? I'm not sure that tax payment by say a random start up or given to en employee would necessarily be 1:1. Netflix made big profits, but paid little tax, if they had paid it as salary (obviously not going to happen) I bet there would be more tax revenue. And that's just assuming the objections are about tax revenue... they're not.
  - EpicEng 8y ago
    "Crack down" doesn't necessarily mean "they're doing something illegal _today_." They could certainly go after the contractor laws and change them. It's not all taxes; many protections employees get are skirted via these gig job companies due to everyone being a contractor.

skrowl 8y ago

Just tip $0 in the app and tip in cash, just like Uber / Lyft

paulgb 8y ago
Speaking of Uber/Lyft, do we have any verification that they aren't doing this? I would expect them to take a 2-3% cut to cover the card processing cost but hope that the rest goes to the driver.
- greenleafjacob 8y ago
  Service fees are not charged on tips to drivers [1]. [1] https://www.uber.com/drive/partner-app/how-tips-work/ https://www.uber.com/drive/partner-app/how-tips-work/
irrational 8y ago
What is this cash you speak of? I jest, but seriously, it has been more than a decade since I last had cash on me. I assume there is someway that I could get cash, but it has been so long I'm probably (okay, definitely) not going to go to the trouble. Saying I should tip them in cash is saying that I shouldn't tip them.
- walls 8y ago
  Stop at a bank every six months and pick up a few fives, it's really not that complicated.
- metildaa 8y ago
  Seriously? Your going to claim to not know of the existence of ATMs or cash back at most grocery stores/7-Elevens? If this is actually your world, I hate to think of the places you'll be constrained to, especially in the US. Seattle is an oddity on the West Coast being card friendly, and from what I gather New York is a cash based economy like most of SoCal.
- ionised 8y ago
  This is the most ridiculous thing I've heard in a while. There are ATM's all over the god damn place.

resters 8y ago

Why doesn't this problem exist when I order something from Amazon? Because there is no absurd idea that I should be tipping the UPS guy or anyone else involved in fulfilling my order. It makes much more sense for InstaCart to simply collect star ratings and offer bonuses for the employees who are going above and beyond. Considering how often the shopper has to call me about replacements, parking outside my building, etc., Instacart should be focusing on fixing the inventory issues and logistical issues, not trying to shame me into paying its employee an extra $5 at every turn. Instacart charges for delivery and often marks up the prices of the items. I don't like being shaken down via a default tip when trying to check out. It's extremely irritating!

bluedino 8y ago
It's not uncommon to tip your UPS/FedEx delivery person, or your USPS carrier. At least around the holidays.
- maxxxxx 8y ago
  The tip you give to the UPS driver is a real tip for good service, not a necessary wage supplement to keep them from starving.
  - megy 8y ago
    How is it good service? Does the driver have any control over the traffic?
    - maxxxxx 8y ago
      I often meet the driver. Some of them are nicer than others.
- wuliwong 8y ago
  I would guess that the ratio of the number of tips to the number of deliveries for UPS/FedEx/USPS is orders of magnitude lower than for Instacart/DoorDash/etc.

ummonk 8y ago

I've always found this practice outrageous but don't understand why everyone else is only getting outraged now that Instacart and DoorDash do it... This is pretty normal in the restaurant and food delivery industry, and should have been made illegal ages ago.

Jordrok 8y ago
This is the exact thought I had when I read the article. I never understood how or why this practice was legal in the first place, but it sounds almost identical to what Instacart and DoorDash are doing. People SHOULD be outraged!
gamblor956 8y ago
That is actually not normal in the restaurant industry. In restaurants, tipped workers get a base wage and earn tips on top of that. If they don't hit minimum wage from that base wage+tips, the restaurant has to pay them so they at least make minimum wage. If you have an issue with the low base wage, take it up with your local legislature. InstaCart and DoorDash are doing something different: they're promising a minimum payment to drivers but that minimum payment is in lieu of a tip. A or B, not A+B=C.

projectileboy 8y ago

Once upon a time, folks would have organized a union and fought for their rights. But I realize that's not very innovative or disruptive, or libertarian or capitalist or whatever the hell the overriding ethos seems to be in Silicon Valley.

pastor_elm 8y ago

200 dollars a day delivering packages? Yeah, that's not going to last, sorry.

saagarjha 8y ago
Do you think they should be getting more or less?
- EpicEng 8y ago
  Less, obviously.

40acres 8y ago

I think the fact that a gig economy company with fair (for lack of a better term) labor practices hasn't shown up yet (to my knowledge) is an indictment on the lack of vision from VCs and entrepreneurs. As a recent NYT article showed, we are moving towards a bifurcated economy split between service workers and high skilled work based on technology. The gig economy has the correct foresight in merging the two but due to the shortsighted nature of VCs these companies have built a business model based on worker exploitation. It's hard to believe that a balance does not exist that would allow for a "gig" company to utilize full-time workers and still be profitable.

maxxxxx 8y ago
I thought the gig economy is about getting rid of burdensome things like paying employees regularly and reliably, or maintaining a fleet of vehicles, or health insurance and then putting the money into the pockets of the company. "It's hard to believe that a balance does not exist that would allow for a "gig" company to utilize full-time workers and still be profitable." Your plumbing business does it, also cleaning companies and most other service businesses. The gig companies can be more profitable because they take shortcuts.
SkyPuncher 8y ago
> I think the fact that a gig economy company with fair (for lack of a better term) labor practices hasn't shown up yet (to my knowledge) is an indictment on the lack of vision from VCs and entrepreneurs. IMO, The "fair" gig economies are inversely correlated with their broadness and accessibility. Uber, Lyft, Doordash, Shipt, etc will never be fair because so many people are able (and willing) to race to the bottom. Things requiring specialized skills generally seem relatively fair. They tend to pay less than a normal job, but still well above minimum wage. That's a fair tradeoff for the flexibility they come with. It's much better than the alternative of not having any options. Tutoring, tech support, care giving, nursing, and more have successful gig economy companies that offer people a way to easily make additional income.
kevin_b_er 8y ago
> I think the fact that a gig economy company with fair (for lack of a better term) labor practices hasn't shown up yet (to my knowledge) is an indictment on the lack of vision from VCs and entrepreneurs. Their vision is likely well aligned. The gig economy metes out little bits of work to a new underclass, while shifting nearly all risk onto them. This improves profit flow. The gig economy bypasses the American Labor Movement. The mandatory binding arbitration bypasses the Rule of Law. The VC's vision is excellent. They extract work out people who don't have much recourse, except they've figured out slavery isn't needed. You just need them hopeless enough to work for nothing, because they can't get anything else. Since they don't need to be paid minimum wage, they don't get benefits, and you can nickle and dime them because you've bypassed the rule of law, you get a lot of advantages over a normal company that has to play by the classic rules of treating humans with any kind of dignity and the laws they got passed to do so. The app concept makes things faceless so the company can make profit by making someone else do the hard work and take the risks.

a-wu 8y ago

DoorDash is extremely helpful for me because I'm disabled and can't cook so it's really convenient for me to be able to order food for delivery when I don't have a caregiver around to cook food for me. I'm extremely disappointed by DoorDash's policies but because of my circumstances I can't just boycott. I live in a college town too, so most DoorDash drivers are students who are just barely getting by, so I'll be tipping my drivers in cash from now.

starpucks 8y ago
Uh huh
newfriend 8y ago
There are plenty of other delivery services. Grubhub, UberEats, and Caviar are a few off the top of my head.
- a-wu 8y ago
  UberEats/Grubhub don't have the same selection of restaurants in my area and I'm really not sure how much I trust them to not pull this same thing either. I will definitely try to order from those services if available but I'll probably still tip in cash.
  - blueline 8y ago
    if ubereats works the same as uber then 100% of the tip actually does go to the worker
darkpuma 8y ago
You should call your local grocery store and see if they have a delivery program. Many if not most do, although it's typically poorly advertised or unadvertised. You can have them deliver prepared food from the store.
- a-wu 8y ago
  Unfortunately the one local grocery store that does have the service runs it through Instacart anyway.

bluedino 8y ago

These services need a Robin Hood hacker to take pennies or dollars from the transactions going to the Instacart bank accounts, and the executives back accounts, and disburse them equally to the workers.

fipple 8y ago

The minute I figured out you can adjust the Instacart fee to zero I did, and leave a fiver for the delivery person.

pithymaxim 8y ago

>Instacart and DoorDash...have figured out a clever way to use customer tips to lower their labor expenses. Isn't this how restaurants work..?

alistairSH 8y ago
Similar, but not exactly the same. In the case of wait staff, the pay system is well known and regulated (see below). In the case of the gig workers, it appears to be up to the employer, unregulated, and not well documented. In the restaurant industry, a waiter must be paid the standard minimum wage (for the state/city/etc). However, because tips are expected, the employer is allowed to pay less IF AND ONLY IF the tips make up the difference. Made up example: State min. wage: $10/hour State adjusted min. for wait staff: $5/hour Tips per hour: $6/hour Actual pay: $11/hour ($5 adjusted + $6 tips) Tips per hour: $3/hour Actual pay: $10/hour ($3 tips + $7 pay)
- alistairSH 8y ago
  In the gig economy, that $5/hour adjust minimum might not exit (because it's not regulated), so the scenarios becomes... Made up example: Employer-stated hourly rate: $10/hour Tips per hour: $9/hour Actual pay: $10/hour ($9 tips + $1 pay) Tips per hour: $3/hour Actual pay: $10/hour ($3 tips + $7 pay) And in the very extreme case... Tips per hour: $11/hour Actual pay: $11/hour ($11 tips + $0 pay) By avoiding the minimum wage, and backfilling wages with tips, the employer can theoretically avoid paying ANY wages to employees (and I'm specifically calling them employees here because I believe most of these gig economy jobs should be employees, even if not legally required to do so).
rconti 8y ago
Yes, but whether or not you think it's immoral, it's legal, and it's codified. Which is different from DoorDash lying to you when they say "100% of the tip goes to your Dasher".

nightcracker 8y ago

Is this legal? Taking tips or paying less to offset tips is theft. I smell a class-action lawsuit.

russellbeattie 8y ago

This is wage theft, but the fact is even with this negative publicity these companies will continue to steal tips from now on. This isn't the first news report about it, but DoorDash and Instacart obviously don't care. They're not so dumb as to not realize how this might be a public relations 'challenge'. They realized it would be seen negatively, did the math, and decided that the general public would be apathetic and the supply of people desperate for work would continue to provide them with enough deliverers regardless of how badly they treat them. The only solution to this is legislative. The whole 'gig' economy is capitalism gone mad, where large corporations take advantage of the most vulnerable people in society for cheap labor without benefits or stability. Governments need to crack down on this before it gets bigger than it already is.

curiousgeorgio 8y ago

Or, avoid the whole problem by eliminating tipping altogether (please!). Charge a fair and honest price where you can compensate contract workers enough to incentivize them to work for you in the first place (no surprises), and customers will appreciate not feeling the pressure to figure out what an appropriate tip might be. Use feedback/ratings to reward exceptional service. As an added bonus, you eliminate the discriminatory problems of certain classes of people earning more tips than others for reasons unrelated to service.

rconti 8y ago

I've never used Instacart, but I've used GrubHub and DoorDash and the like a couple of times -- I can never remember which one I have an account for, or which one has the restaurant I want, so it's always a hodgepodge. But one thing is clear as day. When I use DoorDash, the tip box says "100% of tip goes to Dasher". Look, I know all of these places either charge me a service fee, or if I'm not being charged a service fee, they're marking up the food over list price AND getting a discount from the restaurant for the extra volume generated by the company. FINE. But when you tell me 100% of my tip goes to the tippee and then you take money out of their pay because I tipped them, that is fraud. Money is a fungible good. It doesn't matter that "my" money went to the Dasher, and you took "your" money from them. In fact, that's not even true, because it's all in one CC transaction anyway. 100% of my tip did NOT go to the Dasher.

cannonedhamster 8y ago
This is a good point and likely going to result in a massive class action that a few of these companies don't survive.
- smt88 8y ago
  They'll survive it. The pendulum has swung far toward corporations and awards don't tend to be death sentences these days. What other company has been killed by a lawsuit lately, other than thorough frauds like for-profit colleges?
  - unknownkadath 8y ago
    Well, there's Gawker, but that's also a special case. PG&E?
- techsupporter 8y ago
  DoorDash has a mandatory arbitration clause (that I opted out of but most people don’t) so I fear the best we can hope for is a light tap from a state AG and a flimsy promise to “review our internal procedures” with no big change. It isn’t as though large numbers of people will stop using these services that deliberately abuse their “independent contractor” workers.

AlexandrB 8y ago

Not to be pedantic, but why isn't "Instacart" being annotated as "Instacart (YC S12)" in this latest round of stories? Seems only fair.

jameslevy 8y ago
You don't see this for the YC startups that have become very mainstream. Reddit is mentioned on a front page HN headline right now (https://news.ycombinator.com/item?id=19087558 https://news.ycombinator.com/item?id=19087558) without mention of its batch.
- lucb1e 8y ago
  This is the second time I heard of instacart and it took me a minute to remember what they do (and the first time I heard of doordash), but reddit is much more well-known. Not sure it's that they're so commonplace.
randycupertino 8y ago
They generally only do that on positive-spin articles, not the negative or bad PR ones.

sfilargi 8y ago

Simple way to beat their system: Always enter $0 as tip in their app and the tip the driver with cash or your favorite money app

towelr34dy 8y ago

"Tipping Policies" "deceptive tipping policies" Huh... Somehow I think if I set up a tipping jar for the government and kept the majority of the funds, it would be quickly called 'stealing'. Actually, I think in California since the amount is over $10k, it's grand theft. Welcome to the era of legislative capture, when the criminal activities of a corporation are discovered, "journalists" frame the situation as "big company make mistake, people get upset, people should figure it out and want transparency" and then seem to want to compare this to our outrage culture. lol What transparency could you trust from someone who stole from you? Outrage seems to carry a connotation of being a bit of an overreaction. And a strong reaction. People aren't hurling insults because of this. They are angry. And rightfully so. They were stolen from. The article makes no sense unless you believe it was a 'mistake of deceptive practices'. There's not even a single mention of restitution or ANYTHING that wouldn't have been approved by a corporate PR team in an effort to appear 'unbiased'. If crack dealers had this type of coverage, we'd be hearing about 'Possible loud sounds that could be confused with guns that happen when certain issues arise. Maybe we should ask for transparency to see what is going on?'

sitkack 8y ago
Baffler quality truth right here.

qiqing 8y ago

Excerpt: "Some are asking for cash tips outside the app, while others are encouraging customers to leave 22-cent tips — a nominal amount meant to show solidarity with workers — through the app and then adjust the tips higher after a delivery has been made." I think I might do that from now on.

stephenitis 8y ago

Are Wag and Rover doing this also?

minimaxir 8y ago

Just in: the policy is now being ended: https://www.buzzfeednews.com/article/carolineodonovan/after-scrutiny-instacart-will-end-its-controversial-tipping https://www.buzzfeednews.com/article/carolineodonovan/after-... > “Based on your feedback, today we’re launching new measures to more fairly and competitively compensate all our shoppers,” Mehta wrote. “Tips should always be separate from Instacart’s contribution to shopper compensation.” > Instacart also said it will compensate workers affected by the previously policy. “For example, if a shopper was paid $6 by Instacart, to compensate for our mistake, he or she will receive an additional $4 from Instacart,” Mehta wrote.

FPGAhacker 8y ago
going back how far? I'll believe it when I see it.
AlexandrB 8y ago
But they're cutting shopper compensation at the same time! > In addition, Instacart also said it would adjust the minimum pay per delivery to between $7 and $10 for deliveries for which the driver buys and delivers the groceries, and $5 for delivery-only jobs. Previously, Instacart guaranteed $10 per delivery, but sometimes included customer tips in that amount. What shady behaviour! I'm guessing Instacart did the math on average tips and figured out that with a $5 delivery guarantee + tips shoppers would be back up to around $10 on average. Edit: Yup, that's exactly what happened. > “With an average tip of $5, our customers regularly recognize shoppers with tips for the services they provide."

deleted 8y ago

[deleted]

kartayyar 8y ago

I switched from Instacart to Goodeggs in large part because they say they pay their employees a fair wage and there is no option to tip.

BryanMMMM 8y ago

I remember Uber used to not encourage tipping. GrubHub and DoorDash should do the same thing, at least not encouraging, because tipping would cause more confusions for services like those.

supernova87a 8y ago

What I hate about company behavior is the lack of leadership compass in knowing what is right and wrong, and instead treating every resource (person) as an experiment to see what they'll accept or not. And if they don't hear enough complaints, must've been ok to do. You can read it in their apologies and the positive spin: "We heard loud and clear the frustration when your compensation didn’t match the effort you put forth." Heard you loud and clear? What is this, like the American Idol voting contest? Daytime Emmy awards, or public opinion poll, where we have to be asked what we like to be paid? A proper apology would be: "We know what we were doing was wrong, and we were wrong to do it, and we will not do things like that in the future." Not, "it seems you didn't like what we did, so we'll do something different." Makes you think they won't apologize for doing fundamentally wrong things until they get called out by public opinion. What types of issues should a company know are not ok / illegal, and what issues are subject to public approval or measuring reception? Shouldn't a CEO know these and apologize accordingly? Or maybe that is the role of regulation and government to keep the amoral corporate compass calibrated.

ilaksh 8y ago
It seems to me like the CEO should be fired. Not even from a moral perspective but just from a PR perspective.

mirimir 8y ago

Why don't users just tip with cash? If you're a regular user, it's not such a big deal to have some small bills around. Traditionally, I always tipped in cash, in case people wanted to keep their tips private.

pseudolus 8y ago

Instacart has apparently just reversed its policy. Sometimes outrage does work. https://www.nytimes.com/2019/02/06/business/instacart-tipping.html https://www.nytimes.com/2019/02/06/business/instacart-tippin...

ggm 8y ago

Unions and minimum wages and an end to tipping culture. Anything else is amelioration not really fixing it.

xster 8y ago

> while others are encouraging customers to leave 22-cent tips — a nominal amount meant to show solidarity with workers — through the app and then adjust the tips higher after a delivery has been made This seems like a strangely optimistic assumption to make. I'd imagine it'd be really easy for instacart to batch shopper's payments and retroactively credit or debit the shopper's account to always pay a minimum total depending on the tip.

gumby 8y ago

Too late: I now know how the company thinks about its employees and, frankly how truthful they are with their customers too. So more Instacart and no more DoorDash for me. Simply uninstalling the app won't cause change, so I contacted both Instacart and DoorDash and asked them to delete my account and all PII and when asked, explained why. There are plenty of alternatives to both and I suspect we'll pretty quickly figure out which ones are the creepy assholes and which differentiate themselves by being decent human beings. For that matter, it's worth looking at which investors have supported this kind of attitude, as I'm sure this was discussed in board meetings.

habosa 8y ago

Onoe way you can tell this was no "mistake" is because both companies did it (and probably others). This was industry-wide wage theft in the pursuit of profit.

coffee 8y ago

> ...couriers have braved the elements, gotten by on meager wages and dealt with annoying customers, growling dogs and fifth-floor walk-ups, all for the chance of a big tip from a happy customer. This is not how I experience it working, in my area, with sites like GrubHub and the others. They ask for a tip UPFRONT, before delivery. I usually like to tip cash (for obvious reasons). There is an option for this, and the problem starts when I select this option. My food takes an extra 1+ hour to arrive. It's cold. Soggy. My family has been waiting for around 2 hours total. Interestingly... This NEVER happens when I tip upfront through the app. Complaining to their support line never fixes the issue, so I started asking the delivery drivers about this. What did they say? Apparently, the app flashes the delivery drivers how much tip you've entered BEFORE they decide to take on your delivery. So my order, when I pay a cash tip, simply doesn't get picked up by any delivery driver and it's at the restaurant getting cold and soggy. When I tip upfront, it gets delivered in a normal timeframe. I tested giving a BIG tip upfront, guess what? My order came faster than it ever has in the past. I asked the driver and he flat out told me he saw the big tip and rushed to grab this delivery.

Game_Ender 8y ago
This sounds like fine model to me, pay more, get faster service. The key should be transparency and a minimum service level, ie. they should lay enough by default that every order will get picked up.
- coffee 8y ago
  It's really not a fine model, though. This isn't groceries, or a package from Amazon, this is hot food ready to serve that goes cold and soggy.
  - QuercusMax 8y ago
    Whole Foods (Amazon) grocery delivery has you tip the delivery person up-front. They still seem to screw up my order all the time. I mean, seriously, I KNOW they have the stuff on the shelves, but the delivery people flake out all the time and don't deliver half my order. What a scam.

ghostbrainalpha 8y ago

If you are wondering why these companies think they can get away this this...... Look at the number of comments here from people who are going to continue using these service, and work around the problem by tipping the driver cash. If you believe the leadership is amoral at a company, you have to be willing to walk away entirely or they will keep doing what they are doing.

randomacct3847 8y ago

Honestly makes me wonder if either of these services are long term sustainable without basically not paying the delivery workers. It’s less a case of two companies making huge profits being evil and greedy and more the case of two overfunded unicorns optimized for growth at all cost with bad unit economics and bleeding cash

atom_arranger 8y ago

The thing that's actually terrible is that there's tipping on Instacart in the first place. Uber didn't used to have tipping, it was added later. I'm not really sure why, it makes the experience as a user worse, I'm not interested in thinking about that, just pay the drivers Uber.

LumpLump 8y ago

I see a class action from customers. They gave a person money and it was stolen by a corporation. It is nothing less then thief. The drivers are not working for them so why should they be providing their base pay. Besides if that is the case, each customer should be providing a 1099 to the drivers based on IRS rules.

ag_dart 8y ago

Worked as a PM in one of these Gig companies. Almost all companies do this (Not saying that it's right or wrong). They way they frame it to 'contractors' is "We will make sure you get enough orders to earn $10 in 1 hour. Where that $10 comes from is not something that we care about. If the customers tip you, well there's your $10 dollars, if they don't we will cough up the requisite amount to match the guarantee". There is no such thing as Base Pay as we understand it in this business model.

lightedman 8y ago

When is YC going to be held accountable for the frauds they are bringing upon the population? Instacart is a YC-backed company, and I think it's time the people at the very top got held responsible for these frauds being perpetuated upon us. I really think Paul Graham should be getting sued, and sued hard. Time to bring real ethics back into the world of technology.

SkyMarshal 8y ago

Does anyone know if these delivery companies can survive in a higher interest rate environment? They were tried during the dotcom boom too and all of them went bust. I've assumed the goal in trying them again was 1) cheap money again, 2) better logistics tech so maybe they can make better margins this time, and 3) sell to another established company that can use them as a loss leader, or IPO and expand into other businesses, before rates inevitably rise again. Or do they think they have a viable business model even in a higher rate environment? They seem to be operating on slim margins, hence moves like this tip stealing stuff, or Instantcart's attempts to get customers to sign up for a subscription.

bparsons 8y ago

This is wage theft. These guys will get nailed in one or many of the jurisdictions they pulled this in.

deleted 8y ago

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keerthiko 8y ago

Yet another article about tip outrage that skirts the issue of how culturally propping up universal service industry tipping is propagating and prolonging predatory wage labor by service providers and restaurants. It's in restaurant management and DoorDash's best interests to keep the tipping culture alive and well because they can continue to pay effectively sub-minimum wage by preserving the tip-based wage flexibility the US legally provides them. Oh well.

NicoJuicy 8y ago

If you paid with your credit card, can you do a chargeback? If you tipped, this seems like deceit. And according to me, a good reason for a chargeback