Uber fires 20 workers after harassment investigation

Uber has fired 20 employees after an independent investigation into harassment claims, according to a source with knowledge of the matter.

The San Francisco-based ride-hailing giant launched two separate investigations in February, one led by former U.S. Atty. Gen. Eric Holder’s firm, Covington & Burling, to examine Uber’s workplace practices, and another more narrow investigation led by law firm Perkins Coie to look into allegations of harassment.

The firings were the result of the Perkins Coie findings, a source told The Times.

At a meeting for all Uber employees Tuesday, Perkins Coie said it received 215 complaints and took action in 100 instances, the person said. Some complaints are still under investigation.

Employees were told that those fired were terminated for a range of reasons, including sexual harassment, bullying, retaliation and discrimination. Perkins Coie did not reveal the names of those who were fired, the source said. Uber did not respond to a request for comment.

The terminations come at a critical time for Uber as it attempts to put behind it recent high-profile executive departures, allegations of a sexist and toxic work culture, and a once-praised reputation for being a bullish rule-breaker that has since become a liability.

The firings announced Tuesday were the first concrete steps by the company — which has more than 12,000 employees, hundreds of thousands of contract drivers across the U.S. and a private valuation hovering around $70 billion — to correct its course, according to business experts.

The number of employees fired en masse for poor behavior is “unprecedented,� particularly given the seriousness of the claims, said Jason Schloetzer, a professor at Georgetown’s McDonough School of Business who specializes in corporate governance. And it means that more people will be paying attention to Holder’s report about Uber’s workplace culture, parts of which are expected to be made public next Tuesday.

“These dismissals confirm the smoldering nature of this internal crisis Uber has been facing, and Holder’s report will give us an idea of how broad that crisis is and the level of seriousness Uber is going to take in dealing with it,� Schloetzer said.

Uber hired Holder in February to lead an investigation into a former employee’s claims that the company failed to discipline a manager who mistreated female employees, and that the company had ignored complaints of sexual harassment. Uber set up a hotline where workers could report allegations of wrongdoing and Perkins Coie’s lawyers monitored those complaints.

That former employee, Susan Fowler — an Uber software engineer from November 2015 to December 2016 — accused the company of systemic workplace harassment, discrimination and cover-ups. In a lengthy blog post on her personal website in February, she alleged that a manager had propositioned her and, despite saving copies of their correspondence, human resources failed to discipline him.

“I was told by both HR and upper management that even though this was clearly sexual harassment and he was propositioning me, it was this man’s first offense and that they wouldn’t feel comfortable giving him anything other than a warning,� Fowler said.

Fowler’s blog post also alleged that Uber’s human resource department systemically covered up sexual harassment complaints. She said during her time at Uber, she spoke with many female employees who felt mistreated by some men at the company, and that “some of the women even had stories about reporting the exact same manager I had reported, and had reported inappropriate interactions with him long before I had even joined the company.�

“It became obvious that both HR and management had been lying about this being his ‘first offense,’� Fowler said.

Uber’s chief executive, Travis Kalanick, in February condemned the behavior Fowler described, saying that it was “abhorrent and against everything Uber stands for and believes in.�

In a memo to employees, he said he would bring on Holder to conduct an independent investigation into the incidents detailed in the blog post. Uber board member Arianna Huffington also flew to San Francisco in the days after Fowler’s blog post to oversee the investigation as the company went into damage control.

“I view it as my responsibility to hold the leadership team’s feet to the fire on this issue,� Huffington said in a statement.

But before the results of Holder’s investigation were published, Huffington defended Uber in March, telling CNN’s “Quest Means Business� that sexual harassment was not a systemic problem at the company.

“Yes, there were some bad apples, unquestionably,� she said. “But this is not a systemic problem.�

The results of the Perkins Coie investigation, though, would suggest that it is, with close to 10% of employee complaints leading to terminations.

Business experts said the firings were a step in the right direction, but the company has a lot more work to do if it wants to avoid customer and employee attrition and prevent a stigma from hanging over the company.

Holder’s report is expected to include recommendations on what Uber needs to do next. According to Schloetzer, medium to long-term strategies could include putting in place polices and processes to protect employees from bad behavior, and more closely vetting potential employees to ensure troublemakers aren’t hired.

Uber has spent the first half of the year dealing with a string of scandals. The company’s more recent troubles include customer backlash over Kalanick’s involvement with President Trump’s business advisory panel (Kalanick has since left the panel); a poorly timed tweet during president’s ban on travel from a number of majority-Muslim countries that spurred the #DeleteUber movement, which resulted in some 200,000 customers deleting the Uber app from their phones; video footage of Kalanick berating an Uber driver; a lawsuit from a Google-owned self-driving car start-up alleging that Uber stole the company’s trade secrets; and a string of high-profile departures.

After the months of turbulence, Kalanick pledged to get “leadership help� by hiring a chief operating officer. The company has not yet said whether it has filled the role, but announced two separate high-profile hires this week, including former Apple executive Bozoma Saint John, who will work on the company’s branding, and Harvard Business School Professor Frances Frei, who will serve as Uber’s senior vice president for leadership and strategy.

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UPDATES:

4:25 p.m.: This article was updated to include commentary from business professor Jason Schloetzer.

12:45 p.m.: This article was updated to add new information about the Uber investigation and context about the company’s recent struggles.

This article was originally published at 11:45 a.m.