Criticized for underpaying shoppers, personal grocery delivery company Instacart is changing its compensation model. Personal shoppers were always paid a minimum for orders, but the company had started including tips in that minimum amount. The company admitted to paying only 80 cents in some cases for someone to pick and deliver a batch of groceries. In a petition, personal shoppers claimed that “customers' tips are essentially being paid to Instacart rather than to the workers ourselves.”
In a blog post, Instacart CEO Apoorva Mehta admits “clearly we haven’t always gotten it right.” He announced policy changes to ensure the following:
Tips should always be separate from Instacart’s contribution to shopper compensation
All batches will have a higher guaranteed compensation floor for shoppers, paid for by Instacart
Instacart will retroactively compensate shoppers when tips were included in minimums
Read Mehta’s entire blog post. What principles of business communication does he follow? What, if anything, can be improved?
In what ways does Mehta demonstrate strong leadership character?
How could Instacart have avoided this situation, including the negative effects on personal shoppers and the negative publicity?