Uber to lay off 3,700 workers, CEO to waive salary as coronavirus continues to hinder its business
SAN FRANCISCO - Uber says it will lay off thousands of workers as the ongoing coronavirus pandemic continues to impact its business.
The ride-sharing company said in a filing Wednesday that it is cutting approximately 3,700 full-time employee roles in both customer support and recruiting. The reduction will cost the company about $20 million in severance and other termination benefits.
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Uber also said in the filing that CEO Dara Khosrowshahi will waive his base salary through year-end and that the company is evaluating other costs.
Headquarted in San Francisco, Uber Technologies Inc., has already imposed a hiring freeze and has offered up to 14 days of financial assistance to drivers and delivery workers who were diagnosed with COVID-19 or placed in quarantine.
"Days like this are brutal. I am truly sorry that we are doing this, just as I know that we have to do this," Khosrowshahi wrote in an email about the layoffs to employees, according to CNN.
"As I said at yesterday's All Hands, this is one part of a broader exercise to make the difficult adjustments to our cost structure (team size and office footprint) so that it matches the reality of our business (our bookings, revenue and margins). We are looking at many scenarios and at each and every cost, both variable and fixed, across the company."
Uber said its cutting 3,700 full time employee roles as it grapples with the coronavirus pandemic and its impact on the ride-share business. (Photo Illustration by Beata Zawrzel/NurPhoto via Getty Images)
Fellow ride-share company Lyft laid off more than 982 employees and furloughed hundreds more, according to a filing last week. It also reduced the salaries of remaining employees.
Social distancing guidelines and shutdowns of bars, restaurants and other businesses to help halt the spread of COVID-19 have meant a rapidly deteriorating customer base for ride-share drivers across the country.
A survey last month of Uber and Lyft drivers by the ride-share information website Ridester found that driver income was down by at least 80 percent due to the main sources of business being shut down — including daily commutes, travel to and from entertainment venues, and travel to and from airports.
One Uber driver in West Virigina told VOX that he expected to make at least $1,000 on St. Patrick’s Day — still a week before the state implemented its stay-at-home order — but only made about $150.
As a way to help drivers grappling with the financial impacts of the coronavirus pandemic, Lowe’s announced this week it plans to team up with Uber to deliver Mother’s Day flowers to hundreds of senior living facilities in U.S. cities hit hardest by the virus.
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This story was reported from Cincinnati. The Associated Press contributed.