Uber will tie executive compensation to meeting diversity goals

Posted at 8:02 AM, Jul 15, 2019
and last updated 2019-07-15 13:17:25-04

Uber’s workforce may still be mostly white men, but the company says it is taking new measures to diversify its staff, especially managerial roles.

The newly publicride-hailing company released on Monday its latest diversity report, which included a breakdown of its US workforce by race or ethnicity and gender. White men still make up most of its staff (30.1%), a pattern that is even more evident in leadership, tech, and leadership in tech roles. Black women make up 5.3% of its overall workforce in the US, black men 4%, Hispanic women 3.7% and Hispanic men 4.6%.

For the first time, Uber is setting some diversity and inclusion goals for 2022 that will be tied to the compensation of several of its senior executives — CEO Dara Khosrowshahi, chief financial officer Nelson Chai, chief legal officer Tony West, and chief people officer Nikki Krishnamurthy.

Uber’s global headcount has grown tremendously in the past year: It had approximately 26,000 employees at the end of March 2019, up from 18,000 the year prior. This number does not include drivers, whom Uber does not classify as employees but instead, as independent contractors. Uber had 3.9 million driversglobally at the end of 2018.

While adding thousands of new employees, Uber has shown some diversity gains. The percentage of women in leadership roles grew from 20.9% to 28% in the past year. The largest percentage of women in US leadership roles, though, are white. The amount women in tech leadership roles fell from 15.6% to 13.8%.

At Lyft, by contrast, women occupied 32.8% of all its leadership roles in 2018, but only 11.5% of tech leadership positions. The company, which also went public this year, has not yet released its 2019 report.

Uber barely moved the needle on the number of Hispanic and black employees in tech leadership jobs, according to the report. Both are at 0.8%, up from zero percent last year.

Ahead of last year’s diversity report release, Khosrowshahitold CNN Business that improving senior leadership diversity was a priority.

Its new diversity and inclusion goals for 2022 that are tied to compensation for some senior leaders are to increase the percentage of women in managerial roles and the percentage of underrepresented people in transitional roles, which are sometimes but not always, positions that include managing others.

Uber is also testing a “Rooney Rule” approach for mid-career hires. The original National Football League policy required teams to interview minority candidates for coaching and operations-level roles. In the report, Uber chief diversity officer Bo Young Lee wrote that the goal is to expand the Rooney Rule approach to all its hires in the future.

The company said it also plans to dig into more granular data in the coming months about its global workforce. It is collecting the information through a global self-ID survey where employees can voluntarily share information about their gender identity, veteran status, disabilities and caregiving status, in addition to answering questions about race, sexuality and socioeconomic status.

However, Uber didn’t say in the report how many of its workers are on foreign work visas. Last year, it said 16% of US employees had work visas and that they represented 90 countries.

Tech companies like Apple, Microsoft, and Facebook started voluntarily releasing diversity reports in 2014 following increased scrutiny of the imbalance of gender and race in the industry. Other tech companies eventually followed suit. Uber shared itsfirst diversity report in March 2017 when the company’s “bro culture” and treatment of female employees in particular, was in the spotlight after a former female engineer alleged sexism and harassment.

Diversity and inclusion reports from tech companies have become more robust over the years — recognizing more forms of diversity, such as age breakdowns in an effort to combat ageism — but on the whole, show the industry’s largely underwhelming progress.

Speaking generally about diversity reports, Allison Scott, chief research officer at the Kapor Center, told CNN Business that it is important companies continue to release reports so the public can know their demographics, and whether progress is being made.

“The lack of significant progress indicates how deeply ingrained inequity in tech actually is, and indicates comprehensive approaches — not quick fixes — are needed,” Scott said. “We must ask ourselves, what are the negative consequences to companies when numbers don’t change or hiring goals are not reached?” (Kapor Center’s investment arm, Kapor Capital, invested in Uber in 2010.)

In its newest report, Uber also highlights some employee benefits, such as 18 weeks of parental leave for all full-time global employees. Uber drivers, who are classified as independent contractors and not as employees, do not receive similar benefits such as parental leave, overtime, workers’ compensation, unemployment insurance, or paid sick leave.

A number of driver protests have surfaced in recent months, calling for better treatment and improved conditions for drivers.