Albertsons to cut grocery delivery drivers as it moves to save money with other services

Posted at 9:11 AM, Jan 06, 2021
and last updated 2021-01-06 11:11:30-05

This article was written by John Sowell of the Idaho Statesman.

Don’t be surprised the next time you order groceries delivered by Albertsons if a driver from DoorDash or another company shows up at your door.

The Boise grocery chain will soon stop using its own employees to make deliveries.

“In early December, Albertsons Companies made the strategic decision to discontinue using our own home delivery fleet across a variety of market areas and states, beginning February 27, 2021,” spokesperson Kathy Holland said in an email. “We will transition that portion of our e-commerce operations to third-party logistics providers who specialize in that service.”

Sixteen employees in Southern Idaho will lose their jobs, Holland said. None are union positions, Jack Caldwell, president of Local 368A of the United Food and Commercial Workers Union in Boise, said by phone.

The union represents about 2,300 members in Idaho, including employees of Albertsons, Smith’s Food & Drug, Falls Brand in Twin Falls, McCain Food Services in Burley and BR Management Services at Mountain Home Air Force Base.

“Our HR teams are working to place all impacted associates in stores, plants, and distribution centers,” Holland said.

Holland didn’t say how many drivers would be laid off nationally, but it’s likely hundreds. The Dallas Morning News reported 97 drivers for Tom Thumb, an Albertsons-owned grocer, will lose their jobs. An unspecified number of Albertsons, Vons, Pavilions and Safeway workers in California will also lose their jobs.

Labor leaders see the California layoffs as a direct result of voters’ passage of Proposition 22 in November. It exempts app-based gig companies from a law that would have required the companies to classify drivers and delivery workers as employees. Instead, they can continue to treat them as independent contractors, who pay their own taxes and who typically aren’t provided benefits.

“This is what we predicted would happen with Proposition 22,” Steve Smith, spokesperson for the California Labor Federation, told the Los Angeles Times. “We could see it coming 100 miles away.”

DoorDash put up $52.1 million to pass Proposition 22, second behind Uber, which contributed $59.2 million.

“While we know that this move will help us create a more efficient operation, it wasn’t a decision we made lightly or without a great deal of consideration,” Holland said. “This decision will allow us to compete in the growing home delivery market more effectively.”

Digital sales at Albertsons increased 243% in its quarter ending in September, and 276% in the previous quarter, compared with the same, pre-coronavirus quarters a year earlier.

Albertsons offers online shopping with options to pick up groceries curbside or have them delivered. Those sales have increased as families have stayed home more and cooked more meals during the pandemic.

“Since the COVID-19 outbreak, our eCommerce business has risen to new heights and has become more strategically important to Albertsons Companies,” Holland said. “Our goal is to truly make e-commerce a competitive advantage.”