Instacart, the $2 Billion Grocery Delivery Startup, Is Reclassifying Some of its Workers As Employees

By Maya Kosoff

Instacart, the $2 billion online grocery delivery company, says that starting this week, it plans to turn part of its workforce into part-time employees, Bloomberg reports.

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Not unlike other startups including Uber, Lyft, and Postmates, Instacart relies on human labor to carry out its services for customers. Like these other companies, Instacart has hired its grocery selection and delivery workers as 1099 employees, or independent contractors.

The difference between contractors and W-2 employees is, according to the IRS, for common-law employees, employers "must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid" to full-time employees.