Uber CEO Kalanick to Take Leave of Absence

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June 13, 2017

Uber Technologies Inc. Chief Executive Travis Kalanick will take an indefinite leave of absence from the company amid intense scrutiny over the company’s workplace culture, marking a huge shift for the highflying startup.

June 13, 2017

Uber Technologies Inc. Chief Executive Travis Kalanick will take an indefinite leave of absence from the company amid intense scrutiny over the company’s workplace culture, marking a huge shift for the highflying startup.

Mr. Kalanick said in an email to all Uber staff Tuesday that he would step aside to allow for direct reports to run the company and that he will step in only for major strategic decisions. He is grieving the death of his mother, who was killed last month in a boating accident that also left his father seriously injured.

The leave is necessary, the 40-year-old billionaire co-founder of Uber said, “to become the leader that this company needs.”

The move comes as a report by the law firm of former U.S. Attorney General Eric Holder was slated to be outlined Tuesday. The report had been requested by Mr. Kalanick after a blog post by former Uber software engineer Susan Fowler Rigetti described an aggressive, male-dominated workplace with managers she says ignored her complaints of sexual harassment and sexism—a post that changed the course of the world’s most highly valued startup.

On Tuesday, Mr. Holder’s investigation was to come to a head, as Uber was expected to lay out the probe’s findings and recommendations to 12,000 employees at a weekly all-staff meeting.

Companies often conduct such internal investigations, but rarely make them public because of liability and other concerns, say employment law experts. The situation is unique because of the public nature of Ms. Fowler Rigetti’s allegations, which immediately spread on social media and were dissected for weeks in the media.

The outcome carries significant stakes for Uber, which last year was valued by investors at $68 billion. Some employees have said the investigation and other recent controversies have been painful distractions and threaten Uber’s ability to attract talent. The company is already in the midst of hiring both a chief operating officer and a finance chief, and will need to fill other positions after losing its heads of other areas including marketing and communications.

Over the past several weeks, Uber workers have been summoned to the nearby San Francisco office of Mr. Holder’s firm, Covington & Burling LLP, to describe their experiences, according to employees who have been interviewed or were requested to be.

Another law firm, Perkins Coie LLP, which Uber hired in part to investigate Ms. Fowler Rigetti’s claims, also brought in workers for interviews. Uber said last week that it received 215 complaints out of that probe, and fired more than 20 workers as a result.

Mr. Holder’s investigation is broader, covering Uber’s management practices, and is designed to recommend specific changes. Those recommendations could include new human-resources processes, chains of command and sensitivity-training programs. The report also is expected to recommend the ousters of certain employees, though the names likely won’t be made public.

On Sunday, Mr. Holder’s firm presented its report to company directors, which unanimously approved all of the recommendations following a marathon board meeting in Los Angeles, according to people familiar with the matter. The fallout of that report was evident Monday, when Uber’s chief business officer, Emil Michael, resigned from the company. His exit, which people familiar with the matter say was recommended by the report, was surprising given his close relationship with Mr. Kalanick.

In her blog post, Ms. Fowler Rigetti claimed a supervisor propositioned her for sex and human-resources officials transferred her to another team instead of addressing her complaints. She said she was told she could either work for another group at the company or risk getting a poor performance review.

Ms. Fowler Rigetti also claimed the company discouraged her from making complaints to human-resources officials. Managers changed her positive performance review to a poor one to deny her a promotion, she wrote. Ms. Fowler Rigetti has declined to comment.


Courtesy: The Wall Street Journal

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