Gopuff cuts salary after raising billions of dollars


Gig Economy Update

According to a workers’ rights organization, less than a month after receiving $1 billion in venture capital, the delivery app Gopuff has cut the wages of many of its gig workers to levels that are sometimes below the minimum wage.

Philadelphia-based Gopuff announced its latest capital injection on July 30, valued at US$15 billion, which has more than tripled in less than a year.Only four months passed Raised USD 1.15 billion in MarchThe company stated that it intends to use the money to expand its footprint in the United States and Europe.

However, activists say that while doing so, the eight-year-old startup is squeezing the income of its drivers to protect the meager profits of the “instant demand” business, some of which Well-funded players Land is being scrambled wildly in emerging fields.

“Unlike competitors such as DoorDash and Instacart, Gopuff has always managed to put their treatment of workers under the radar-until now,” said Working Washington, a nonprofit organization based in Seattle.

Like its competitors, Gopuff’s delivery drivers are odd jobs. They pay for fuel and other expenses, and there is no guarantee of working hours. However, drivers can choose to book “shifts” at the lowest hourly rate, which differs from one location to another. If only paying the commission (usually about $3 per trip) does not meet the hourly minimum income, Gopuff will increase the driver’s income on weekends.

According to data from the Washington Work Organization, which collects data from 71 Gopuff locations in the United States, about half of drivers have seen their guaranteed minimum hourly rate drop, averaging about $4 per hour.

In the most extreme case recorded, the guaranteed minimum fee for drivers operating at a Gopuff location in Dallas, Texas, dropped from $20 to $9 per hour.

“I think Gopuff is looking for ways to simplify operations and reduce costs,” said Brittain Ladd, an industry consultant. “And, unfortunately, reducing the cost of drivers is just one of the things they are doing.”

Using the IRS’s cost-per-mile benchmark, 56 cents, the organization believes that drivers’ jobs are usually less than the minimum wage. The team shared an example of a shift that lasted nearly 9 hours during which the driver drove 113 miles in the area near San Antonio, Texas.

Gopuff operates approximately 300 warehouses in the United States, excluding the locations it inherited through the acquisition of liquor retailer BevMo! And Liquor Barn stated that it is misleading to refer to the decline in income guarantees as “salary cuts.”

Gopuff stated that the previous wage rate was a “temporary” salary increase implemented during “operational changes” in selected markets, but did not elaborate. It says that most drivers earn between $18 and $22 per hour, although this includes customer tips.

“In view of the rapidly changing nature of our industry, we will adjust the compensation of our partners to balance the ever-changing dynamics of supply and demand in each market we serve,” Gopuff said.

However, most workers surveyed by Working Washington stated that they were unaware that these changes were temporary. Ohio driver Bradleigh Aeh said that even among those who did, “there is no information about how long it will last or when it will end.”

She said: “We don’t have time to deal with our affairs at the end of the raise.” “This is already a struggle. It will definitely make my life harder.”

In addition, in at least 16 locations, rates have fallen below the level before the “temporary” increase in Gopuff.


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