At the end of the day, the people will get hired back by somebody who needs their groceries delivered. Meanwhile, this makes Insta more of a software company, and lets the stores deal with hiring.
The market is going to love this because it will de-risk Instacart. Grocery stores should love this because they will be able to increase utilization of their employees. And of course employees, despite the popular narrative, will actually gain more power because they would have more localized work, and less competition. It's a win-win-win.