Instacart to pay $5.25 million to settle workers' compensation case

San Francisco accused the company of violating health care and paid sick leave orders.

Instacart will pay workers $5.1 million in a settlement after they allegedly failed to provide certain benefits, as reported by The San Francisco Chronicle. San Francisco accused the company of violating health care and paid sick leave orders. The company, which has not admitted wrongdoing, will pay an additional $150,000 to cover the city's legal costs and pay a settlement administrator to distribute the funds.

"Instacart has always correctly categorized shoppers as independent contractors, giving them the ability to set their own schedule and earn money on their own terms," ​​Instacart said in a statement. "We remain committed to continuing to serve customers across San Francisco while protecting access to the flexible earning opportunities that Instacart shoppers always say they want."

Individuals who worked as independent contractors for Instacart in the city between February 2017 and December 2020 are eligible for payments based on the number of hours worked. San Francisco estimates that between 6,000 and 7,000 people are affected by the colony. The city and Instacart previously entered into a similar settlement that covered an earlier period. San Francisco also settled a benefits-related case with DoorDash.

After December 15, 2020, Instacart workers were subject to Proposition 22, which offered them certain benefits without the company having to define them as employees. An Alameda County Superior Court judge ruled in 2021 that the measure was unconstitutional, but it remains in effect as Instacart, DoorDash, Uber, Lyft and other gig companies that funded Prop 22 appeal of the decision. Another lawsuit - filed by San Francisco, Los Angeles and San Diego - claims that Uber and Lyft drivers should have been classified as workers until Prop 22 was passed.

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