Drivers for grocery startup Imperfect Foods have voted to unionize, taking organized labor further into on-demand delivery

• Northern California drivers at Imperfect Foods have voted to unionize.
• The grocery startup said it would challenge the results.
• The election represents a win for unions among delivery workers after recent setbacks.

Delivery drivers at Imperfect Foods have reportedly won an election to form a union.

Bloomberg first reported on Friday that a group of the grocery delivery startup's drivers in Northern California had won an election overseen by the U.S. National Labor Relations Board. Results showed that 28 drivers had voted to unionize while 23 were against it. The union would represent about 80 employees if it materializes, according to the report.

Imperfect Foods got its start in 2015, mainly selling produce that did not meet supermarkets' cosmetic standards but was still edible. Since then, it has added other kinds of food, such as fresh meats and beauty products. The roster of customers for its weekly grocery deliveries has exploded thanks, in part, to the pandemic.

Imperfect Foods told Insider that it would challenge the union results, saying that the election results "were materially impacted by the inability of certain drivers to timely obtain ballots." A representative for the United Food & Commercial Workers union told Bloomberg that it "believes in the integrity of the results of the election" and plans to bargain with Imperfect Foods's management.

Workers at Imperfect told Bloomberg that the union drive began last summer in an effort to fight high healthcare costs and heavy workloads delivering boxes of fresh foods to customers.

The startup is one of several digital grocery marketplaces that has seen sales balloon and fundraising soar over the past year thanks to pandemic-driven demand. As of January, Imperfect alone had raised $239 million, according to Pitchbook.

Other grocery marketplaces include Hungryroot, Thrive Market, and Good Eggs. And a host of delivery-focused startups have also had banner years as consumers looked to avoid in-person shopping, most notably Instacart, which The Information reported last month is planning to go public by the end of 2021.

Unionization efforts at delivery-focused companies have suffered setbacks in recent months. In January, Instacart laid off its only unionized employees as part of a broader move that affected hundreds of positions. This month, a high-profile unionization election at an Amazon facility in Bessemer, Alabama, failed to get enough votes from workers there.

Companies that rely on gig workers to make deliveries got a boost during last year's elections when California voters approved Proposition 22. The measure's passage preserved the independent contractor designation instead of having to classify them as full employees.

Unlike at Instacart or many other startups, the Imperfect Foods delivery workers who voted to unionize are not independent contractors, meaning that they're entitled to protections under federal law, including organizing rights. Recent job postings for Imperfect drivers in San Francisco, Boston, and the Washington, DC area described full-time positions with pay of between $17 and $22 an hour and benefits like medical and dental insurance.

Do you work at Imperfect Foods or another grocery company and have a story to share? Contact this reporter at abitter@insider.com or by phone, text, or encrypted messaging app Signal at (808) 854-4501 using a non-work phone.