Uber’s Toxic Workplace Culture

A company director shouting a homophobic slur at a subordinate during a meeting. A manager groping female co-workers’ breasts during a company retreat. A manager threatening to beat an underperforming employee’s head in with a baseball bat. All of these incidents — and more — are described in a fascinating front-page story on Uber’s workplace culture by New York Times reporter Mike Isaac, who based his story on interviews with 30 current and former employees of the ride-hailing service and reviews of internal emails, chat logs and tape-recorded meetings.

As you’ve probably heard, Uber found itself thrust into the spotlight after former employee Susan Fowler published a blog post last Sunday about her experiences working for the company. Fowler, an engineer, said she and other women were sexually harassed and discriminated against by her manager and little to nothing was done about it, even when she reported it to HR, because the manager was a “high performer.” (Fowler’s descriptions of her interactions with Uber’s HR department are particularly damning: For example, when she noted to an HR representative how few women were in her engineering department, the rep allegedly told her that she shouldn’t be surprised by the ratio of women in engineering because people of certain genders and ethnic backgrounds were better suited for some jobs than others.)

Fowler and other current and former Uber employees told Isaac that HR would excuse poor behavior by their bosses because the managers in question were top performers who benefited the health of the company. The company’s culture — set by Uber CEO and co-founder Travis Kalanick — emphasizes getting ahead at all costs, the sources told Isaac, even if it means undermining co-workers and supervisors. One group in particular that was shielded from accountability was “the A-Team,” the sources said, a group of executives close to Kalanick.

Since Fowler went public with her accusations, Kalanick has brought in former Attorney General Eric Holder and board member Arianna Huffington to conduct an independent investigation of the issues Fowler raised. He said the company would release a full diversity report shortly and that 15.1 percent of the engineering, product management and scientist roles at Uber were held by women and that that number “has not changed substantively in the last year.”

In a statement to the Times, Uber CHRO Liane Hornsey said “We are totally committed to healing wounds of the past and building a better workplace culture for everyone.”

Hornsey, who joined Uber in January (its former HR chief, Rene Atwood, left in July to join Twitter) and who will assist with the investigation, spent nine years as Google’s vice president of global people operations. Hopefully she’ll be able to put her experience and expertise to good use at a company that appears to sorely need it.

More Bad News on 401(k) Front

Seems the 401(k) red flags just keep waving. This latest report from Ben Steverman on the Bloomberg.com site — based on U.S. Census Bureau research — shows a whopping two-thirds of Americans aren’t putting money into any defined-contribution plans.

That’s right. Based on this research, which relies on tax data instead of surveys (as in the past), only about a third of workers are saving in a 401(k) or similar tax-deferred retirement plan.

What’s more, it now appears — using this new research methodology — that only about 14 percent of employers offer retirement plans at all! How can that be? As the report explains:

“Census researchers Michael Gideon and Joshua Mitchell analyzed W-2 tax records from 2012 to identify 6.2 million unique employers and 155 million individual workers, who held 219 million distinct jobs. This data produced estimates starkly different from previous surveys.

“For example, previous estimates suggested more than 40 percent of private-sector employers sponsored a retirement plan. Tax records uncovered a much bigger pool of small businesses, showing that, overall, just 14 percent of all employers offer a 401(k) or other defined-contribution plan to their workers.”

Bigger companies, the researchers say, are the most likely to offer 401(k) plans, and since they employ more people than small firms, they skew the overall number of U.S. workers who have the option. Gideon and Mitchell estimate that 79 percent of Americans work at organizations that sponsor a 401(k)-style plan. In the words of the report:

“The good news is that’s more than 20 points higher than previous estimates. The bad news is that just 41 percent of workers at those employers are making contributions to such a plan — more than 20 points lower than previous estimates.”

But should we all be trying to shepherd employees into 401(k)s? Earlier posts by me on this site suggest that’s a very good question. This one from January finds the creators and supporters of the retirement-savings vehicle now lamenting their creation. None of them imagined the vehicle would replace pensions, leaving workers struggling to ever contribute enough to their 401(k)s to retire comfortably.

As Herbert Whitehouse, a former human resource executive for Johnson & Johnson and one of the earliest proponents of the 401(k) for employees, tells the WSJ in that post, he and others were hoping and assuming back in 1981 — when the 401(k) was in its infancy — that the savings approach would be a kind of supplement to company pensions.

They did not imagine the idea would actually replace pensions as employers looked to cut costs and survive during subsequent downturns. As Whitehouse puts it in the WSJ story:

“We weren’t social visionaries.”

Then there’s this post a little later in January presenting the opinion of benefits expert Larry Sher, who thinks there’s even more corrupt and wrong with the savings vehicle than its merely replacing pensions. He blames the people who’ve had skin in the 401(k) game all along, who’ve been reluctant to give up their own benefits of the system — a system that forces employees to shoulder more responsibility and stress.

The chief concern of policymakers, employees and even some of the employers that have embraced the 401(k) concept, Sher says, “can be summed up as the total shifting of risks to employees — the risks that they won’t save enough, the risk that they will use the savings for non-retirement purposes, the risk of unfavorable investment results — culminating in inadequate retirement savings and the prospect of outliving such savings.”

Meanwhile, some states and cities have introduced local individual retirement accounts designed to encourage workers to save by requiring employers to either offer a retirement plan or automatically enroll their workers in the state- or city-sponsored IRAs.

The U.S. House of Representatives, however, voted to rescind those rules on Feb. 15, citing the IRA plans’ unfair competition to the financial industry. If the GOP-controlled Senate and President Donald Trump sign off on the move, all such auto-IRA plans would be placed in jeopardy, leaving people in the lurch once again. As Steverman writes:

“Whatever the outcome, any effort to get workers to save for retirement faces a daunting challenge: Can Americans spare the money? Student debt and auto loans are at record levels, according to Federal Reserve data released Feb. 16, and overall consumer debt is rising at the fastest pace in three years.

“Retirement is an important goal, but many Americans seem to have more pressing financial concerns.”

Uber’s Sex-Harassment Inquiry

In case you missed it over the long holiday weekend, there’s plenty of trouble brewing over at ride-share app Uber.

It’s now so serious that the company hired former U.S. Attorney General Eric Holder to investigate whether the company has appropriately addressed discrimination and harassment claims made by female workers.

The investigation comes after former Uber engineer Susan Fowler Rigetti posted her story on Sunday, detailing her experiences enduring sex harassment at the hands of her direct manager, as well as the stonewalling she says she was subjected to by the company’s HR and leadership after she repeatedly brought the claims to their attention.

According to Fowler Rigetti:

On my first official day rotating on the team, my new manager sent me a string of messages over company chat. He was in an open relationship, he said, and his girlfriend was having an easy time finding new partners but he wasn’t. He was trying to stay out of trouble at work, he said, but he couldn’t help getting in trouble, because he was looking for women to have sex with.

It was clear that he was trying to get me to have sex with him, and it was so clearly out of line that I immediately took screenshots of these chat messages and reported him to HR.

Uber was a pretty good-sized company at that time, and I had pretty standard expectations of how they would handle situations like this. I expected that I would report him to HR, they would handle the situation appropriately, and then life would go on – unfortunately, things played out quite a bit differently.

After receiving less-than-enthusiastic support from HR, she describes how she came to know other women at Uber who had experienced the same harassment and subsequent stonewalling, and how those women decided to use a strength-in-numbers approach to alert HR to the seriousness of the ongoing issue:

Myself and a few of the women who had reported him in the past decided to all schedule meetings with HR to insist that something be done. In my meeting, the rep I spoke with told me that he had never been reported before, he had only ever committed one offense (in his chats with me), and that none of the other women who they met with had anything bad to say about him, so no further action could or would be taken. It was such a blatant lie that there was really nothing I could do. There was nothing any of us could do. We all gave up on Uber HR and our managers after that. Eventually he “left” the company. I don’t know what he did that finally convinced them to fire him.

After the story initially broke, Uber CEO Travis Kalanick tweeted that the behavior mentioned in the post was “abhorrent & against everything we believe in. Anyone who behaves this way or thinks this is OK will be fired.”

Hiring someone like Eric Holder will definitely add credence to an investigation that had previously looked paper-thin. And while only time will tell if Holder uncovers any more stories like Fowler’s, I get the feeling this sordid story isn’t over by a long shot.

Firing Someone over Politics

With conflict between President Trump supporters and detractors still at a fiery pitch, and with his protested inauguration still in the rearview mirror, this recent post on the Littler site might prove helpful.

In it, a boss in Sacramento, Calif., is asking the San Francisco-based employment law firm whether an employee can be fired, or at least disciplined, after the boss “saw one of my employees on the local news the other night participating in a political rally over the weekend.”

“Can I at least institute a policy prohibiting this kind of behavior going forward?” the boss asks.

Well, it all depends, Littler’s Zoe Argento writes, “on the employee’s location, the legality of his conduct, the employee’s contract, the nature of your business and the characteristics of the individual.” But best advice: Probably not a good idea and tread very carefully.

There are some state laws that prohibit employers from taking adverse action against employees because of their off-duty lawful political activities. So know your state’s laws on this. According to Argento:

“In California, employers may not coerce employees, discriminate or retaliate against them, or take any adverse action because they have engaged in political activity. Similar prohibitions exist in other states, including Colorado, Louisiana, New York, South Carolina, and Utah. Connecticut actually extends First Amendment protection of free speech to the employees of private employers. Some of these laws provide exceptions for public or religious employers or for off-duty employee conduct that creates a material conflict with respect to the employer’s business interests. Under such laws, and absent some exception, the proposed termination or demotion of this employee because of his lawful, off-the-clock political activity would be illegal.”

Also, Argento points out, at least three states — California, Louisiana and Colorado — prohibit employers from adopting any policy, rule or regulation that forbids or prevents employees from engaging or participating in politics or from running for office.

On the federal level, she says, firing or disciplining workers who engage in rallies, protests, marches or any other polticial activity could run afoul of the National Labor Relations Act, which provides that “employees shall have the right … to engage in … concerted activities for the purpose of … mutual aid or protection.” She continues:

“The U.S. Supreme Court has interpreted this provision to mean that employees may organize as a group to “improve their lot” outside the employer-employee relationship. Employees’ participation in political advocacy would therefore be protected if it relates to labor or working conditions. Such advocacy can include contacting legislators, testifying before agencies or joining protests and demonstrations. If the means used are not illegal, an employer would generally be barred from retaliating against employees who participate in these political activities outside the workplace.

“Depending on the nature of the activities your employee engaged in and his role in your organization, it may violate the NLRA to penalize him. If the employee participated in a rally concerning sick leave, minimum wage, or immigration reform, for example, that conduct would likely be protected.”

Argento signs off with some sound practical advice, that a decision to terminate or discipline an employee “should be based on an objective assessment of both the individual’s job performance and your business needs.” She writes:

“If the employee is otherwise a solid performer, and if his behavior does not interfere with the operation of your business, an adverse employment decision may be difficult to explain, undermine morale in your workforce, and, on balance, have more negative than positive results.”

Rule of thumb, she signs off, “proceed with caution” before penalizing employees for lawful, off-duty poitical activities, whether they’re frustrating to you or not.

A Bad Day for Puzder and Unions

Andrew Puzder (photo by Gage Skidmore)

He’s outta there — Andrew Puzder is, at any rate, having withdrawn his name from consideration as President Donald Trump’s Secretary of Labor. Trump introduced today Alexander Acosta, dean of Florida International University College of Law and a former member of the National Labor Relations Board, as his new DOL nominee. Puzder’s nomination had been plagued by controversy from the start. Current and former employees of CKE Restaurants, where Puzder serves as CEO, accused him of vastly underpaying workers and denying them benefits at the company’s Hardee’s and Carl’s Jr. fast-food chains and musing aloud that he wished he could replace them with robots. Matters were not helped by an investigation by Capital & Main that uncovered a widespread pattern of abuse, harassment and discrimination of and against CKE employees at the chain-store and corporate level. Six cases were filed against the company by the Equal Employment Opportunity Commission, “far more than any other large burger chain on a per-revenue basis, with the exception of Sonic Drive-In,” the website reported.

Puzder enjoyed strong support from many in the business community, as our story in December reported. However, Democrats were strongly against him. “Puzder’s disdain for the American worker, the very people he would be responsible for protecting, is second to none,” Senate Minority Leader Chuck Schumer, D.-N.Y., told CNN.

What really appeared to sink Puzder’s nomination, however, was the revelation that he’d employed an undocumented immigrant as a housekeeper and the allegations of brutal domestic abuse against his ex-wife (although she’s since denied that the abuse took place) that culminated in the release on Politico of an Oprah Winfrey episode that featured the ex-wife, Lisa Fierstein, in disguise describing details of the abuse she’d said she’d suffered. A number of Republican Senators informed the White House that they would no longer support Puzder, who announced his withdrawal yesterday afternoon.

Labor advocates cheered Puzder’s withdrawal, but they’re probably not happy about the closely-watched vote that took place yesterday at Boeing’s South Carolina plant, in which workers voted overwhelmingly against joining the International Association of Machinists union.  More than 2,000 of the 3,000 workers eligible to vote voted no, while only 700 voted in favor, CNN reports. Had the workers voted in favor of the union, it would have marked a big change in South Carolina, a right-to-work state with the lowest union membership rate of any state in the country, at 1.6 percent, according to the Bureau of Labor Statistics. The union had previously called for a vote at the plant in 2015 but canceled it amid doubts about worker support. Now it will have to wait for a year before calling for another election, per National Labor Relations Board rules.

Boeing had argued strongly against unionization, with management saying the union would call for costly strikes and was not needed. However, the IAM had argued during its campaign that workers at the South Carolina plant were paid wages that are 36 percent lower than their counterparts at Boeing’s heavily unionized plants in Washington state.

Boeing management expressed victory. “We will continue to move forward as one team,” Joan Robinson-Berry, vice president in charge of Boeing South Carolina, said in a statement.

In his own statement, IAM lead organizer Mike Evans said: “We’re disappointed the workers at Boeing South Carolina will not yet have the opportunity to see all the benefits that come with union representation.”

Googlers Pass on Massive Payouts

Can you have too much of a good thing?

A handful of Googlers working on the company’s self-driving car project seem to think so.

The Mountain View, Calif.-based tech giant’s car unit—which in December 2016 spun off into a standalone business known as Waymo—has seen staffers exiting in noteworthy numbers, and walking away from potentially huge paydays in the process, as Bloomberg reports this week.

The unit “has been a talent sieve” for at least the past year, according to Bloomberg, “thanks to leadership changes, strategy doubts, new start-up dreams and rivals luring self-driving technology experts.”

But the business’s “unusual compensation system that awarded supersized payouts based on the project’s value” has helped contribute to its retention struggles, notes Bloomberg. “By late 2015, the numbers were so big that several veteran members didn’t need the job security anymore, making them more open to other opportunities, according to people familiar with the situation. Two people called it ‘F-you money.’ ”

Indeed, “a large multiplier” was applied to compensation packages toward the end of that year, “resulting in multimillion-dollar payments in some cases,” Bloomberg reports, adding that one member of the team had a multiplier of 16 applied to bonuses and equity amassed over four years, for example.

The same article points out that the system was revamped when the autonomous car unit morphed into Waymo late last year, and replaced with a more uniform pay structure that treats all employees equally. By that time, however, “the original program got so costly that a top executive at parent Alphabet Inc. highlighted it last year to explain a jump in expenses.

“The payouts contributed to a talent exodus at a time when the company was trying to turn the project into a real business,” the article continues, “and emerging rivals were recruiting heavily.”

Part of the issue at Waymo “was that payouts snowballed after key milestones were reached, even though the ultimate goal of the project—fully autonomous vehicles provided to the public through commercial services—remained years away.”

While reports have underscored rumblings within the car division, ranging from questions surrounding the unit’s leadership and strategy to engineers’ designs on starting their own self-driving vehicle companies, “the big payouts exacerbated the [turnover] situation because team members had less financial incentive to stay,” according to Bloomberg.

Ironic, isn’t it, that the company would start losing talent by paying them too much? When was the last time your organization had this problem? If there’s a lesson here for HR and compensation professionals, it might be that over-the-top rewards might end up having unintended consequences, and that massive lumps of cash don’t necessarily guarantee employee loyalty.

Office Romances Hit 10-Year High

In case you haven’t noticed all the heart-shaped sweet treats making the rounds today at work, it’s Valentine’s Day!

And, just in time for the annual event, a new report from CareerBuilder finds romantic relationships among co-workers “may be more common than you think.”

According to CareerBuilder’s annual Valentine’s Day survey, 41 percent of workers have dated a co-worker (up from 37 percent last year and the highest since 2007). Additionally, 30 percent of these office romances have led to marriage, on par with last year’s findings.

(The national survey was conducted online by Harris Poll on behalf of CareerBuilder from a representative sample of 3,411 full-time, private sector workers across industries and company sizes.)

Office romances are just not happening between peers, according to the report:

Of those who have had an office romance, more than 1 in 5 (29 percent, up from 23 percent last year) have dated someone in a higher position than them — a more common occurrence for women than men (33 percent versus 25 percent).

Fifteen percent of workers who have had an office romance say they have dated someone who was their boss.

And as if dating a superior weren’t risky enough, 19 percent of office romances involved at least one person who was married at the time.

As you might expect, keeping a workplace relationship out of the workplace is difficult. with nearly two in five workers who have had an office romance (38 percent) saying they had to keep the relationship a secret at work. Male workers were just as likely to keep their office romances secret (40 percent) compared to their female counterparts (37 percent).

By region, of those who have had office romances, 45 percent of workers in the Northeast say they kept their office relationships secret compared to 41 percent in the South, 34 percent in the West, and 31 percent in the Midwest.

On an admittedly rather ambiguous concluding note, the survey notes that, while 7 percent of workers say they currently work with someone they would like to date this year, 5 percent of workers who have had an office romance say they have left a job because of an office relationship gone sour.

 

 

Travel Ban Would Impact Many

Though President Trump’s travel ban has been frozen indefinitely, a decision made Thursday by the United States Court of Appeals for the Ninth Circuit, it’s still worth noting how many organizations would be affected should Trump proceed successfully in appealing the decision to the United States Supreme Court. He has vowed to do just this, according to the New York Times report linked above. (More recently, on Friday, he said he is now considering rewriting the immigration executive order in question.)

Whatever we end up with,  a survey of 261 companies by the Seattle-based Institute for Corporate Productivity (i4cp) — conducted just a few days after Trump signed the order restricting entry to the U.S. by travelers from seven majority Muslim countries — reveals more than a third (36 percent) of organizations would be impacted by the travel ban. Another 21 percent were still scrambling to make that determination at the time of the poll.

Within a week of the signing of the executive order, nearly 100 companies — including many of the largest global-tech organizations such as Intel, Microsoft, Apple, Netflix and Uber — responded by joining in the filing of a brief in support of a lawsuit against the travel ban filed by the state of Washington. It was that lawsuit that was at the heart of the Ninth Circuit Court of Appeals decision Thursday.

In its release about the survey, i4cp describes the responses as very mixed:

“While some respondents lauded the executive order for protecting the safety of employees, others drew attention to its potentially negative impact on the recruiting and motivation of a diverse, inclusive global workforce, a clear illustration of the polarization of views and reactions.”

Some respondents reported they are simply unsure of the impact of the travel restrictions because of a “lack of transparency in their global contract workforces, which are managed by vendors,” the release states.

Human resources, however, was the predominant responsible party (at 41 percent) for managing internally anyone affected by the ban, followed by legal, 7 percent; CEO, 6 percent; other senior executive, 5 percent; and security, 1 percent. (Other responses included don’t know, 10 percent, and other, 30 percent.) As i4cp states:

“Often, [HR’s lead] is in conjunction with legal teams responding to the needs of individual employees.”

In a few cases, companies reported having multifunctional “SWAT” teams in place responding to the situation. And nearly a third said they are providing legal assistance to affected employees and their families.

Of course, these were the actions in place when the ban was in place. No doubt things have returned to normal since the freeze and its being upheld in appeals court. But should Trump succeed at the Supreme Court level, these challenges would be back on employers’ plates immediately. Would be wise to stay poised to help these employees — and clearly, there are a lot of them — once again if need be.

Lipnic Outlines EEOC Priorities

I’m sure many of you are wondering what the Equal Employment Opportunity Commission might look like under the Trump administration. Well, yesterday, we were given a bit of a glimpse, when newly named Acting Chair of the EEOC Victoria Lipnic offered her first public comments during a discussion and live webinar that took place in the Chicago offices of Seyfarth Shaw. (Lipnic served as counsel for the law firm before arriving at the Commission in 2010 and was named Acting Chair of the agency by President Trump on Jan. 25.)

Seyfarth Shaw Partner Gerald Maatman, author of the recently released 13th Annual Workplace Class Action Litigation Report, joined her for the discussion.

As reported in an article appearing on the Corporate Counsel website, Lipnic suggested that the agency will “focus on cases involving age discrimination and equal pay while exploring ways to foster job growth in companies.”

“Lipnic said she believes more will remain the same than will change,” according to the Corporate Counsel piece. “ ‘We are an enforcement agency … and the EEOC is committed to its core values and mission, to enforce civil rights laws in the workplace.’ ”

She also said she wanted to “re-evaluate the costs and benefits of the modified EEO-1 report, a detailed compliance survey that employers must fill out,” the story reported.

Speaking to that point, Randy Coffey, a partner with Fisher Phillips in Kansas City, commented in a piece posted on HREOnline earlier this month that “Lipnic opposed additions to the current EEO-1 reporting requirements relating to collection of employee pay data, due to the burden of compliance for employers and the lack of usefulness of this type of generalized data.”

I suspect we’ll see, in fairly short order, how this ultimately translates into policy changes.

Facebook Boosts Bereavement Leave

In 2015, SurveyMonkey CEO Dave Goldberg died unexpectedly at the age of 47. On Tuesday, his wife — Facebook Chief Operating Officer Sheryl Sandberg — announced that the social networking giant will now give employees up to 20 days of paid bereavement leave in the event of an immediate family member’s death and up to 10 days for the death of an extended family member.

“People should be able both to work and be there for their families. No one should face this trade-off,” Sandberg wrote in a Facebook post announcing the new policy. “Amid the nightmare of Dave’s death when my kids needed me more than ever, I was grateful every day to work for a company that provides bereavement leave and flexibility. I needed both to start my recovery.”

Sandberg also announced that the company will offer up to six weeks of paid leave to care for a sick relative and three paid days for employees to care for a relative with a short-term illness, such as  a child with the flu.

Facebook’s generous bereavement policy puts it far ahead of most — if not all — U.S. employers. Although 80 percent of U.S. companies have bereavement policies, they offer an average of only four paid days of leave for the death of an immediate family member, according to the Society for Human Resource Management’s 2016 Paid Leave in the Workplace survey. There is no federal law requiring employers to give workers paid time off to grieve for the death of a loved one.

Obviously, most companies don’t have the financial resources of Facebook (which is also locked in an arms race with other well-funded Silicon Valley companies for tech talent) and probably won’t be emulating it anytime soon, if ever. But I hope that Sandberg’s announcement gets HR and other company leaders to seriously think about the support they currently offer to grieving employees and consider giving more. Here at HRE, we have several colleagues who’ve suffered the loss of a close family member within the last year and a half.  No amount of time off can make up for such a loss, but simply giving employees the support and the time necessary for attending to the so-called “business of death” — making funeral arrangements, resolving legal and financial issues, comforting other family members — means a lot.  And that often requires more than three or four days.