Homejoy Closes Down, Google Hires Some Of Its Workers
Beginning July 31, Homejoy will officially be closing shop, shutting down its cleaning services throughout 35 cities in the U.S. as well as in Canada, UK, Germany and France for good.
Striving to provide parents and college students with an “easy solution to help out with your household chores,” siblings Adora and Aaron Cheung started Homejoy back in 2012 as a cleaning service that is rooted in the principle of the popular sharing economy such that you can contact the company if you are looking to have your place cleaned. Sadly, Homejoy’s success is short-lived.
In a letter written by Adora on their website, she said, “Although we succeeded in many ways, we also faced obstacles. There are still many unresolved challenges in the home services space. We gave it our all, but regretfully, we have made the difficult decision to cease operations. Homejoy will officially close its doors on July 31st.”
TIME reports that the closing of Homejoy comes just as the company was slapped with a class-action lawsuit due to their home-cleaning professionals being classified as independent workers instead of full-time employees. LA Times reports that in the said lawsuit, plaintiff J.C. alleged that by being classified as an independent contractor rather than full-time, they are deprived of reimbursements and overtime wages. Moreover, the same thing has reportedly happened to other on-demand companies such as Postmates and Try Caviar.
In addition, Re/code reports Homejoy is having a hard time securing enough funding following four lawsuits it is facing regarding classification of workers as employee or contractors. Adora Cheung told Re/ code, “A lot of this is unfortunate timing. The [California Labor Commission’s] Uber decision … was only a single claim, but it was blown out of proportion.”
Adora was referring to the California Labor Commission’s decision to classify an Uber driver as an employee, instead of a contractor. Much attention has been the given to the labor dynamics in a sharing economy since.
Meanwhile, Re/code has also reported that Google has decided to hire as much as 20 people from Homejoy’s product and engineering team. The said workers will be working on matching local home maintenance professionals (such as plumbers, lawnmowers and cleaners) with online users. Early on, Homejoy actually managed to raise $40 million in funds from PayPal founder Max Levchin, Google Ventures, Y Combinator, First Round Capital, Redpoint Ventures and some angel investors.
As for how Homejoy intends to go about business during its last remaining days in operation, Adora said, “We’re determined to support you to keep your homes humming and business buzzing, so we will do our best to ensure partners and clients who want to continue to work together get a chance to do so independently of Homejoy. We bid farewell, and thank you. It was our privilege to be part of this movement and to have helped your homes and businesses shine brighter.”