[Sam Dan Truong / Unsplash]

Stiffed on the Tip: Instacart Found Guilty of “Tip-Baiting”

10:00 June 10, 2020
By: John Glover

Silicon Valley is at it again and not in a good way. By this point, we've come to associate the gig economy with worker exploitation and abysmal labor practices. The speed with which that correlation has become old hat is disheartening. It doesn't seem that long ago now, when tech entrepreneurs were spinning yarn about how the new guard on the internet would usher in a fresh utopia, a golden age fueled by crypto-bonanzas and made of binge-worthy cat videos.

Maybe that's all they were ever doing: spinning yarn. One thing is for sure: To the extent that the dream was ever possible, at this date, it appears over the hills and far away.

In real terms of the dream-turned-nightmare, the gig economy is the internet's dark pièce de résistance, a glaring amalgam of noble premises culminating in the worst of all possible conclusions.

When Silicon Valley giant Uber did its first "disruption," connecting a customer to a freelancer at the expense of a professional driver, they promised to liberate the worker. The gig economy promised flexible hours and no one to tell you what to do. In short, you got to be your own boss! Who wouldn't want that? What workers got instead were wages below the living standard, no benefits, and the isolation of the open road precluding the possibility of collective bargaining formore humane conditions.

[Hobi industri / Unsplash]

Enter Instacart, one of the latest in the cottage industry of Uber copycats to identify a previously unexploited niche. Instacart connects its gig workers with grocery store shoppers who prefer to do their buying in absentia. Instacart users post their shopping lists on the app, and an Instacart shopper gets the groceries using company credit and delivers them straight to your doorstep. Easy as pie (or, at least, a pie that you get someone else to buy for you using smartphone software).

As with other gig services, if it was popular before the pandemic hit, business went through the roof after it happened. Instacart's model relied on people of means being too lazy or too busy to go to the grocery store themselves. Now, the whole world was positively terrified to leave their homes. The people who were able to (or required to) shelter-in-place indefinitely weren't going anywhere.

In a stroke, the Instacart service became simultaneously more relevant and more exploitative than ever. It became a medium through which affluent people subsidized workers to risk their lives in order to deliver them, the well-heeled, their daily bread. As problematic as that set of exchanges already seems, strap in because it only gets worse.

[Bruno Kelzer / Unsplash]

The tech news site The Verge did some investigative journalism and found out that the problem of quote-unquote "tip-baiting" was endemic. Tip-baiting is exactly what it sounds like. Customers lure the Instacart shopper into performing efficiently by promising a fat tip. Then, after the service has already been completed, they switch the decent tip with a miserly one or stiff the shopper altogether.

The Instacart app facilitated this kind of misbehavior because it allowed customers to remove the tip or alter it as many as three days after the fact. After the announcement of a congressional inquiry into this practice following on the heels of the reporting, Instacart, caught with its hand in the proverbial cookie jar, announced it was changing its policy.

Instead of three days, customers would be given 24 hours to retroactively leave a new tip. Additionally, customers must now provide written feedback to justify a change of tip. The app said it would police the tips and remove repeat offenders.

[Rupixen.com / Unsplash]

An independent caucus of U.S. senators, led by Sen. Brian Schatz (D-HI), wrote a letter to the Federal Trade Commission (FTC), asking them to investigate Instacart. Instacart has proven itself amenable to public pressure and outrage, if nothing else, in the past. Maybe this time will be no different.

The problem with the new guard in Silicon Valley is that they're still the new kids on the block, more or less. At least, they are in relation to the sloth-like speed of public policymaking. Regulators can't keep pace with the breakneck movement of Big Tech disruption. Having seen what these Silicon Valley companies will do to their employees when left to their own devices, it seems that the government can't catch up fast enough.

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