IPO-bound Postmates is under fire right now after making some changes to its payments structure for its delivery workers. Organizers at Working Washington say these changes can reduce pay for typical jobs by up to 30 percent.
Up until this past weekend, Postmates guaranteed its delivery workers at least $4 per job. Postmates has since gotten rid of that minimum job guarantee and changed the base rate per job, as well as changed the per-mile rate in some markets. In San Francisco, the new pay structure entails $1.90 per pickup, $0.50 per dropoff, $0.07 per minute and $1.29 per mile.
Postmates says the new rates “remove the need for a minimum guarantee adjustment so you always know exactly what you’re earning,” the company wrote to workers in an email, obtained by TechCrunch.
“At Postmates, we are dedicated to lowering the barrier to work and providing our Postmates Fleet with the resources they need to supplement their incomes. Technological innovations reduced pick up times, and route efficiencies are increasing the rate and pace of deliveries a Postmates can choose to make in a given hour, increasing payout averages from $17/hour in 2018 to $19/hour in 2019,” a Postmates spokesperson told TechCrunch. “This adjustment reflects those gains. Unlike competitors, Postmates always keep 100% of their customer tips, and those tips never eat into base earnings.”
The spokesperson continued: “All told, these earnings gains are not only significantly higher than the federal minimum wage, but over 70% are being cashed out within minutes via our Instant Deposits program. The long term upward mobility of our Postmates on and off the platform are also why we continue to lead the industry in career development resources, health care resources, and long-term savings tools — while working with policymakers & worker voice organizations around the country to balance worker benefits with worker flexibility in the gig economy.”
Organizers with Working Washington, however, are asking other gig economy workers to sign a petition asking Postmates CEO Bastian Lehman to pay the company’s workers better. They want the minimum guarantee back and they want a more transparent pay structure.
Sage Wilson, an organizer at Working Washington who also spoke out about Instacart and DoorDash, says nearly 1,000 workers have signed a petition to Postmates CEO Bastian Lehman in about 24 hours.
In California, one delivery worker made just $3.49 for a thirty-minute, three-mile job. That comes out to about $7 per hour, but if you account for mileage expenses and other payroll taxes, Working Washington says that comes out to $5.29 per hour.
“Postmates is worth nearly $2 billion,” Working Washington organizers wrote on their blog. “They can afford to pay workers more than $4 per job — but as they prepare to go public and continue their race to the bottom against companies like DoorDash and UberEats, they’re cutting our pay even as our costs increase. They’re using sneaky language to try to trick workers into thinking these changes are good for us — saying they’re trying to make pay “clear, consistent, and easy to understand”…and that “the new [lower] rates remove the need for a minimum guarantee.”
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