Category: Operations

Instacart Still is Confusing Customers About Tips

Just a year ago, back in 2017, Instacart was sued by its shoppers (workers) and it settled a $4.6 millionย in a class action suit. Instacart denied the allegations of 18 violations that included issues such as failure to pay back or reimburse business expenses and improper tip pooling. It was also required that the company change the way that the tip was referred. In the app customer’s were being charged an optional service fee of 10% of their the price of their order which was noted to be used to support the service. Many customers took this to mean that the 10% fee was the same as a tip and would go to the shoppers. However, in order to top in the app, there were several other screens that need to be navigated through to find the actual tip area.

Many shoppers such as myself were very upset about the difficulty that customers were having in finding the area in the order to give a tip. On many deliveries, I was asked how tips were handled because it was not clear in the app how to do it. So through December 2017 until about March 2018, I received the majority of my tips in cash.ย  Around April 2018 more changes were made to the service fee/tip with the service fee being an optional donation that customers could decline and tips to shoppers were more clearly notated. However, with this change, the number of tips that I received did not increase in fact, it declined even a bit further.

Then on November 14th, 2018 us shoppers were notified that there was going to be a new customer pricing structure that just took effect which offered most customers a 5% service fee and a 5% default tip. The default tip is very detrimental to shopper earnings. On average customers have been placing smaller and smaller orders on average the total orders are about $50.ย  The default tip for an average order is around $2.50. Of course, many customers believe that the delivery fees come directly to us shoppers in addition to the tips however, we are getting only a portion of those fees.ย  Instacart generally is expecting customer generosity to bring value to the shopper’s hard work.