- Instacart is adding miles to some Seattle deliveries, helping avoid paying the city gig worker wage.
- It created a border to define orders in the city from the suburbs after the Pay Up law took effect.
Some gig workers in and around Seattle are traveling miles more than normal to deliver groceries and takeout food as the companies they work for try to avoid the city's new pay law.
Seattle's minimum wage law for gig workers took effect January 13, requiring companies like Instacart and DoorDash to pay those workers a minimum wage comparable to the city's $19.97 hourly minimum.
But some orders and order offers from Seattle and its suburbs seen by Business Insider suggest that the companies are avoiding paying the higher wage by sending shoppers to stores outside the city to fill orders — even if it takes longer and adds miles to the delivery run or risks disappointing customers.
One recent offer from Instacart seen by a shopper who works in the Seattle area involved driving 7.4 miles from a Total Wine store to a customer's home in the Shoreline neighborhood to deliver some hard seltzer. There was another Total Wine store about half as far from the customer's house with a similar product selection, but it was located within the city of Seattle, the shopper who shared the offer with BI said.
As presented, the entire delivery would have taken place outside Seattle city limits, meaning that Instacart would not have had to pay the shopper according to the Pay Up law.
"Someone could order ice cream, and now we're driving eight miles to deliver ice cream when they have the grocery store right across the street," the shopper told BI. The shopper asked not to have their name used in this article for fear of retaliation from Instacart. BI verified their identity and work for Instacart.
"I've noticed that a lot of my regular customers have stopped ordering" outside the Seattle city area, the shopper added.
Two other order offers seen by BI show delivery routes that involved delivering groceries from stores north of Seattle to addresses to the west of the city in Kirkland, Washington — even though both chains have closer locations in Seattle itself.
Still, before the law was enacted, Instacart had laid out how it would deal with orders within the city and outside. A day before Pay Up took effect, Instacart said that the company's gig workers would "only be able to facilitate orders from Seattle retail locations to customers who live within Seattle."
"This means that customers outside of Seattle will not be able to order from stores within Seattle, and vice versa," Instacart said.
An Instacart spokesperson confirmed the hard border, saying that the company faced "extensive requirements to conduct business within Seattle, which do not apply to customer or retailer locations outside of the city limits."
They added: "We cannot apply different regulatory structures to the same customer order."
But it's becoming increasingly clear that creating the border has started disrupting shoppers. Some have even said it's created a dead zone where accepting orders of any kind is impossible.
One such area is 145th Street, a road that runs East-West and functions as the northern boundary between the City of Seattle and the suburban neighborhood of Shoreline. The street is also home to stores frequented by Instacart shoppers, such as a QFC supermarket, which Kroger owns.
"It won't let me take an order when I am in Seattle, or in Shoreline, or even at the store," one shopper posted on Reddit in January after Instacart made changes in response to Pay Up.
Instead, the app "just gives me the error message that I can't accept non-Seattle batches while in Seattle even when I am not in Seattle."
Instacart — and other gig apps — have been making their opposition to Seattle's pay law clear.
Since it took effect in January, Instacart has fielded a survey of 250 shoppers that it says shows overwhelming dissatisfaction with the law — though BI reported that the study asked about elements of working for Instacart, such as tips, that Instacart has made changes to even though Seattle didn't require them.
Other companies, including DoorDash and Uber, have also demanded rollbacks of all or parts of the law.
Do you work for or use Instacart, DoorDash, Uber Eats, Walmart Spark, or another gig delivery app and have a story idea to share? Reach out to this reporter at abitter@businessinsider.com