Uber to Lay off 3,700 Employees Amid Coronavirus Pandemic

It has been reported that Uber is set to lay off 3,700 employees, amid fewer people being out during the coronavirus pandemic. According to a SEC filing, the company cited "lower trip volumes in its Rides segment" as a main reason for the lay offs. Uber also referred to a "current hiring freeze" as a contributing factor as well.

In the filing, Uber wrote: "On May 6, 2020, Uber Technologies, Inc. (the "Company") announced plans to reduce its operating expenses in response to the economic challenges and uncertainty resulting from the COVID-19 pandemic and its impact on the Company's business. The Company is reducing its customer support and recruiting teams by approximately 3,700 full-time employee roles. In connection with these actions, the Company estimates that it will incur approximately $20 million related to severance and other termination benefits. The Company is evaluating other cost and will provide an update in subsequent SEC disclosures regarding such amounts, if material."

Notably, the filing also reveals that Uber CEO Dara Khosrowshahi has "agreed to waive his base salary for the remainder of the year ending December 31, 2020." He came to this decision " after consultation with the Board of Directors." The filing added, "In connection with this decision, Mr. Khosrowshahi and the Company entered into a letter agreement, effective as of May 2, 2020."

Uber is just one of many U.S. businesses that have faced major setbacks due to the pandemic. In April, Best Buy CEO Corie Barry issued a video statement, revealing that the company would be furlough roughly 51,000 hourly employees. "The situation we are all facing as a result of the COVID-19 pandemic is truly unprecedented," Barry said. "As we previously communicated, we made the decision for the health and safety of our customers and employees to shift our stores to a temporary enhanced curbside service-only model starting March 22. At that time, we also suspended all in-home delivery, installation and repairs. I am so incredibly proud of our teams' execution – they seamlessly implemented a new and highly effective operating model in a matter of 48 hours across our entire store base."

Barry continued: "We are fulfilling essential technology needs for customers in a safe and innovative way, including continuing to provide remote technical advice and support. This time of working, learning, cooking, entertaining and, importantly, connecting across the country from home only underscores our strategy and purpose: to enrich lives through technology. We have retained approximately 70 percent of our sales compared to last year since moving to our enhanced curbside service model despite the fact that all our Domestic stores are closed to customer traffic and approximately 40 of them, particularly in the Northeast, have been completely closed to all business for at least 10 days at our discretion. This is a testament to the strength of our multi-channel capabilities – as our Domestic online sales are up over 250 percent and approximately 50 percent of these sales are from customers choosing to pick up their products at our stores since moving to our curbside service model."