More than 125,000 people who worked for grocery delivery company Instacart are expected to receive payments starting Friday stemming from a lawsuit filed by the city of San Diego that accused the company of improperly classifying workers as independent contractors.
In its lawsuit, the city said Instacart's workers were deprived of the protections and compensation they would have received as employees, such as overtime pay, paid breaks and reimbursement for expenses, including gas mileage and cellphone data.
The case was settled in 2022, and Instacart agreed to pay $46.5 million in restitution and penalties. Nearly $40 million of that total will be sent out this week as restitution, according to the San Diego City Attorney's Office, which said the remaining civil penalty funds will be placed into a trust fund used for enforcement of consumer protection laws.
Eligible recipients worked as Instacart "shoppers" between Sept. 13, 2015, and Dec. 15, 2020, and should receive payments from settlement administrator Simpluris. The size of payments depends on the number of hours worked during that time period, but the City Attorney's Office said the most active workers could see payments exceeding $10,000.
City Attorney Mara Elliot said in a statement that "many vulnerable San Diegans depended on Instacart shoppers and other frontline workers to survive the COVID-19 crisis, and it is gratifying to see these workers finally get the respect and pay they deserve."
After the settlement was reached, Instacart said in a statement that its California workers were always properly classified as independent contractors and noted that the settlement contains no admission of any wrongdoing.
"We're pleased to have reached an agreement with the city of San Diego. Instacart has always properly classified shoppers as independent contractors, giving them the ability to set their own schedule and earn on their own terms," the company's statement read. "We remain committed to continuing to serve our customers across California while also protecting access to flexible earnings opportunities for Instacart shoppers."
