DoorDash (NYSE: DASH) is launching an ultra-fast delivery service right in the beating heart of New York City. What's more, this new service will be staffed by hourly employees rather than gig workers- a notable break from the company's usual model.
From New York City's first-ever DashMart, located in Chelsea, couriers will circuit the neighborhood on electric bikes, delivering household goods and groceries to doorsteps in 15 minutes or less. The logistics of organizing these ultrafast deliveries was one of the reasons the company cited for going with hourly staff rather than gig workers.
"The work associated with powering instant delivery from DashMarts is fundamentally different from dashing, and it requires individuals looking for a different type of work, "said DoorDash in a statement.
Those hired under the new model will work for a brand new company, Dash Corps. They'll get paid $15 an hour plus tips. They'll use a different app than DoorDash to make their deliveries. They'll punch in and out, wear uniforms, report to managers, and otherwise experience all the joys of shift work.
DoorDash expects most staff will work 20 hours a week, but full-time work will be available. Part-time workers will get access to commuter benefits and employee assistance programs, while full-time workers will qualify for dental, vision, and health insurance. DoorDash President Christopher Payne said he expects DashMart to hire some 60 odd staff initially.
For the time being, DoorDash will keep deliveries to a tight radius around the initial DashMart location to speed up delivery times and promote workers' safety. But the company said it plans to roll out to new locations as it seeks to break into the "instant delivery" business currently being pioneered by startups like GoPuff and Jokr, the latter of which has been operating in New York since late summer.
"This is an emergent category that can fundamentally transform the convenience expectation with customers," DoorDash President Christopher Payne said in an interview.
Uber has yet to break into the instant delivery category, but it does partner with GoPuff to speed up delivery times for UberEats in some instances. Meanwhile, Instacart currently has an express option in some cities, which promises deliveries in 30 minutes or less.
For advocates, simply switching employment status from gig worker to full time likely won't be enough.
For instance, DoorDash will likely use Automated software to track employees' movements, likely resulting in pressure to shorten their delivery windows perhaps to the detriment of their safety.
Gustavo Ajche, a cyclist for GrubHub (NASDAQ: GRUB) and DoorDash and leader of Los Deliveristas Unidos, a group representing some 4,000 central American couriers in New York City, notes that some 24 delivery cyclists died in traffic incidents in the city in 2021 alone.
"Pushing the workers to move faster to deliver something in less than 15 minutes, it's dangerous, it's not safe for workers," he told Wired.
Max Rettig, DoorDash's VP for global policy, said the new positions "a great compliment" to its gig work jobs. "Our philosophy is more choice, more opportunity is ultimately a good thing," he told Wired.
Last year, DoorDash, Uber (NYSE: UBER), Lyft (NASDAQ: LYFT), and Instacart collectively spent $200 million to advance a proposition to reverse legislation forcing them to classify their workers as employees.
Rettig said that the company will continue to work to advance similar measures across the country.