Uber CEO Travis Kalanick to take time away from the company

Key Points
  • Uber CEO Travis Kalanick ordered an urgent investigation earlier this year into allegations of gender bias and sexual harassment at Uber.
  • Kalanick will take a step back from the company, and his control over issues will be diminished.
  • At least 20 staff members have also been fired as the result of a separate investigation by law firm Perkins Coie.
Uber CEO Travis Kalanick to take time away from the company
Uber CEO Travis Kalanick to take time away from the company

Uber released the results of a hightly anticipated internal investigation on Tuesday, and announced CEO Travis Kalanick will take time away from the company to grieve for his mother, who was recently killed in an accident. Kalanick did not disclose a return date.

A source told CNBC that day-to-day operations will be run by a committee which includes several female executives: Rachel Holt, manager of North America, Frances Frei, senior vice president of leadership and strategy, and Liane Hornsey, chief of human resources.

Kalanick will also be relieved of some duties, which will be taken over by an independent chair, the report said. Eventually, these duties may be given to or shared with a new chief operating officer who is "diverse," the report said.

The report made 47 recommendations, including creating a board oversight committee, rewriting Uber's cultural values, reducing alcohol use at work events, and prohibiting intimate relationships between employees and their bosses.

(Here is the full list of recommendations)

Here's the full email from Kalanick:

For the last eight years my life has always been about Uber. Recent events have brought home for me that people are more important than work, and that I need to take some time off of the day-to-day to grieve my mother, whom I buried on Friday, to reflect, to work on myself, and to focus on building out a world-class leadership team. The ultimate responsibility, for where we've gotten and how we've gotten here rests on my shoulders. There is of course much to be proud of but there is much to improve. For Uber 2.0 to succeed there is nothing more important than dedicating my time to building out the leadership team. But if we are going to work on Uber 2.0, I also need to work on Travis 2.0 to become the leader that this company needs and that you deserve. During this interim period, the leadership team, my directs, will be running the company. I will be available as needed for the most strategic decisions, but I will be empowering them to be bold and decisive in order to move the company forward swiftly. It's hard to put a timeline on this - it may be shorter or longer than we might expect. Tragically losing a loved one has been difficult for me and I need to properly say my goodbyes. The incredible outpouring of heartfelt notes and condolences from all of you have kept me strong but almost universally they have ended with 'How can I help?'. My answer is simple. Do your life's work in service to our mission. That gives me time with family. Put people first, that is my mom's legacy. And make Uber 2.0 real so that the world can see the inspired work all of you do, and the inspiring people that make Uber great.
See you soon, Travis

Over 200 interviews and 3 million documents were used as part of the investigation, which was helmed by law firm Covington & Burling, led by former U.S. attorney general Eric Holder. After several days of deliberation, Uber's board unanimously adopted the recommendations in the report.

The recommendations suggest measures that are already common in most workplaces, including "prohibiting consumption of non-prescription controlled substances during core work hours, at work events, or at other work-sponsored events," and disclosure of romantic relationships. The report also recommends more accountability measures for senior leadership, including compensation programs and travel reimbursement.

Travis Kalanick
Tobias Hase | AFP | Getty Images

But the report also comes down forcefully on the hard-charging culture that's become synonymous with Uber's success, pushing for "zero tolerance" of harassment and discrimination. It suggests Uber "eliminate those values which have been identified as redundant or as having been used to justify poor behavior, including Let Builders Build, Always Be Hustlin', Meritocracy and Toe-Stepping, and Principled Confrontation; and encourage senior leaders to exhibit the values on a daily basis and to model a more collaborative and inclusive Uber culture."

Even food was a point of conflict in the report: "Uber should consider moving the catered dinner it offers to a time when this benefit can be utilized by a broader group of employees, including employees who have spouses or families waiting for them at home, and that signals an earlier end to the work day."

The building drumbeat for change at Uber

Uber already had a rocky start to 2017, entering the political fray early on when Kalanick left President Donald Trump's advisory council amid protests and a negative social media campaign.

But a firestorm erupted around the company when former Uber engineer Susan Fowler alleged the company failed to act on sexual harassment and gender discrimination complaints. Kalanick called for an urgent investigation into the claims.

A series of other accusations of misconduct soon surfaced. A video revealed Kalanick yelling at a driver. The New York Times uncovered software that allowed Uber to evade authorities. And people associated with the company made troubling claims, including that some top brass at Uber went to an escort-karaoke bar in Seoul.

Meanwhile, the company fought a lawsuit from Alphabet's Waymo, alleging an Uber engineer (since dismissed) had stolen Waymo's intellectual property.

The bad press came to a head last week when Recode reported that a top Uber executive had obtained the medical records of a customer who was a rape victim and shown them to other executives as part of an investigation into the role of a rival.

Shuffle of top staffers

Tuesday's report recommended a renewed search for a chief operating officer and an "owner" of human resources-related policies, the installation of an independent chairperson and an oversight committee to Uber's board.

It also said recommendations should be executed by someone "viewed positively by employees," and advised an elevation of Uber's diversity chief. The report dug deep into Uber's hiring practices, noting it should try a version of the diversity hiring approach of the NFL's Rooney Rule.

"Uber should ... at a minimum, prioritize an increase in the headcount for Human Resources Business Partners across Uber's various regions," the report said. "According to an analysis by the Society for Human Resource Management, the average number of Human Resources Business Partners for a company of Uber's size is approximately 57. Uber should quickly manage out poor performers within the Human Resources organization."

The report also suggested making it easier for employees to transfer, report complaints and understand their performance evaluations.

The report comes as a slew of top staffers have left Uber, and new faces have emerged to lead the company this year.

Amit Singhal, former senior vice president of engineering, was out after he failed to disclose allegations of sexual harassment at his last job. President Jeff Jones left the company, saying his beliefs were "inconsistent" with what he saw at Uber. The head of finance also left.

And Anthony Levandowski, accused of stealing Alphabet's trade secrets, was fired. Eric Alexander, accused of obtaining the customer's medical records, is gone too.

Most high profile was Emil Michael, Uber's senior vice president and a controversial figure, who announced his departure Monday.

At least 20 staff members have also been fired as the result of a separate investigation by law firm Perkins Coie, which looked at claims of sexual harassment, retaliation, discrimination and more.

Meanwhile, Uber has added a new board member and two executives focused on branding and leadership, respectively.