Uber's Travis Kalanick Announces Leave Of Absence; Company Adopts Harassment Policies

Chaya Babu

Chaya Babu

Uber's embattled CEO Travis Kalanick announced Tuesday that he is taking a leave of absence from the company for an unspecified amount of time.

The leave comes after an internal review of the firm's culture and practices, which was sparked by a former employee's claims the company ignored her complaints about sexual harassment and gender discrimination.

Uber is hoping the wide ranging recommendations made in the report by former USA attorney general Eric Holder will help it move on from a string of scandals that have hit its reputation and concerned investors.

Specifically, the recommendations call for adding independent members to the board of directors, including an independent chair. They also suggest changes to company culture, including prohibiting romances between bosses and their reports and creating clearer guidelines on the use of drugs and alcohol. "The Board should evaluate the extent to which some of the responsibilities that Mr.Kalanick has historically possessed should be shared or given outright to other members of senior management", the report says.

"It's hard to put a timeline on this - it may be shorter or longer than we might expect", the 40-year-old Kalanick said in an email to Uber employees.

Holder's firm also said Uber should hold senior managers more accountable and should improve diversity.

"Uber should utilize the Rooney Rule for women and other underrepresented populations for key positions, wherein each pool of candidates interviewed for each identified position includes at least one woman and one member of an underrepresented minority group, thereby ensuring that members of the populations now underrepresented in Uber's workplace are interviewed with appropriate consistency", the report states. Uber fired Anthony Levandowski, former head of Uber's self-driving auto unit at the center of Alphabet's lawsuit, in late May after the company said he had failed to cooperate with its investigation. On Monday, Uber said its chief business officer, Emil Michael, is leaving the company.

In addition, Uber needs to require that managers "immediately" report instances of discrimination, harassment or retaliation, and ensure that the company's codes of conduct apply to offsite events and conferences, too.

In a statement, Uber said that the recommendations had been unanimously adopted by its board. Kalanick and cofounder Garrett Camp control voting rights on the privately company. The report also called for the appointment of a senior executive to oversee the implementation of its recommendations.

That firm checked into 215 complaints, with 57 still under investigation. The ride-hailing service, founded in 2009, managed to upend the taxi industry and become the world's most valuable startup, with a valuation of $68 billion.

Since then, Uber has suffered a series of setbacks, including a federal probe into the company's use of technology to evade regulators in certain cities, a trade secrets lawsuit filed by Alphabet Inc's (GOOGL.O) self-driving unit, Waymo, and an exodus of top executives. The recommendations, which were released Tuesday to employees and to the public, suggest a broad range of changes to the ride-hailing app's workplace culture.

"It's dangerously high risk for the company to continue with a CEO who has yet to reach even an adolescent maturity", said Eric Schiffer, brand management expert and CEO of Reputation Management Consultants. The company intends to raise the profile of the head of diversity, adjust executive compensation to incentivize good behavior, institute mandatory leadership training and establish an employee diversity advisory board.

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