Albertsons ditching in-house drivers to deliver online orders
Albertsons Cos. has announced that some of its stores in California will stop using its own employees to deliver online grocery orders beginning on Feb. 27 and move to independent contractors instead.
The grocery giant, which has used a mix of in-house and third-party drivers in the state in recent years, is making the move in response to the recent passage of Proposition 22. The law exempts third-party providers from having to treat workers like employees rather than contractors, regardless of how much of their incomes are dependent on that work. Opponents of the proposition, prior to its passage, argued that it would allow companies to cut in-house workers to opt for lower paid third-party providers.
The retailer has not said how many workers will be affected by the decision or if those being shifted to other positions will receive pay and hours commensurate with what they are currently making. It’s not clear if Albertsons is looking to make a wholesale move to third-party drivers across its entire network of chain stores.
An article by Knock.LA painted a picture of Albertsons as engaging in corporate hypocrisy. It pointed to the chain’s pronouncements of its workers as essential and heroic in the early days of the pandemic while making the decision to jettison them as soon as it became financially expedient for the company.
Albertsons and its divisions, like other grocers, have enjoyed booming sales during the pandemic as consumers spend a greater percentage of their disposable income eating at home. The grocer reported same-store sales growth of 13.8 percent during its second quarter. Online sales jumped 243 percent during the period. Albertsons’ solid second quarter performance followed even bigger gains during the first quarter when its comps were up 26.5 percent driven by a 276 percent jump online. The grocer is scheduled to release its third quarter earnings next week.
- Vons, Pavilions to Fire “Essential Workers,” Replace Drivers with Independent Contractors – Knock.LA
- Albertsons, Vons shifting to third-party grocery delivery in California, elsewhere – MarketWatch
- A major grocery store called its workers ‘first responders’ early in the pandemic. Now, it’s making the ‘strategic decision’ to ditch in-house delivery in favor of contractors. – Business Insider
- Albertson Companies, Inc. Reports Second Quarter Results – Albertsons Companies, Inc./Business Wire
- Albertson Companies, Inc. Reports First Quarter Results – Albertsons Companies, Inc./Business Wire
DISCUSSION QUESTIONS: What do you make of Albertsons decision to no longer use its own employees to deliver online orders? Do you expect all grocers to eventually transition to third-party delivery services rather than perform many of those functions in-house?