Uber scandal highlights the importance of a strong HR department

Brihony Tulloch

March 21, 2017

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HR is the critical piece in any portal puzzle. Photo credit: Shutterstock

US ride share portal Uber has been the centre of controversy as of late. In February, a former employee named Susan Fowler, accused the company of sexual harassment, discrimination and threats against employees who complain.

Her blog post went viral and has sparked an official company investigation into the claims led by former US Attorney General Eric Holder They have raised almost $16 billion in cash and debt to date and are valued at $69 billion. They’re also expected to attempt an IPO in 2018.

Nevertheless, Uber’s public relations problems highlight the importance of a strong human resources department that operates in sync with management. Without this synchronicity, start-ups could face PR nightmares like Uber’s.

According to comments from previous Uber employees, the company’s apparent toxic culture starts from the inside. Recode.com reports co-founder and CEO Travis Kalanick feels the function of HR at Uber was largely to recruit talent and also efficiently let go of personnel when needed. The company didn’t even establish a human resources department until 2014 when they reached 500 employees.

The alleged behaviour outlined in Fowler’s blog post is in clear violation of most HR codes of conduct that dictate employees should treat each other with respect and courtesy. While working as a site reliability engineer in 2015 Fowler claims her manager made inappropriate comments about his open marriage as well as sexual advances toward her. Appalled at the inappropriate and unwanted behaviour, Fowler took a screenshot of the messages and lodged an official complaint with HR. Their response was that he was a high-performing employee with no previous complaints against him. Fowler recalls what happened next:

“I was then told that I had to make a choice: (i) I could either go and find another team and then never have to interact with this man again, or (ii) I could stay on the team, but I would have to understand that he would most likely give me a poor performance review when review time came around, and there was nothing they could do about that.”

Fowler tried to “escalate the situation but got nowhere with either HR or with [her] own management chain”.

Dr Sugmar Mariappandar, a human resources expert at ACU believes that Fowler’s claims indicate a weak and disorganised HR department at Uber.

“What [the case] clearly indicates is that the HR department over a period of time are not efficient, their systems are not strong because there is no consensus,” he said.

“A strong HR department needs to be consistent in what they’re doing as well as it has to have consensus with the line management, that’s the key.”

He also highlights that it’s not just employees that suffer when there’s weak HR processes, but the company overall.

“Earlier there used to be around 30% women, but now it’s around 6%. Very effective and skilled employees leave because of the organisational value of not respecting others properly.

Uber’s behaviour has not just caused a headache for themselves but their investors too. The ride share company was rebuked by the company Mitch and Freada Kapor from Kapor Center after Susan Fowler’s sexual harassment claims came to light.

“Uber’s success in terms of growth of market share, revenues and valuation are impressive, but can never excuse a culture plagued by disrespect, exclusionary cliques, lack of diversity, and tolerance for bullying and harassment of every form,” they wrote in an online letter.

“Uber has had countless opportunities to do the right thing,” they wrote. “We feel we have hit a dead end.”

Independent board member Ariana Huffington is also outraged by the claims and stated publicly she will “hold Uber’s leadership team’s feet over the fire” till their sexual harassment policy is thoroughly investigated.

Officially Uber is horrified by Fowler’s claims and fully supports an investigation. Kalanick voiced his thoughts on Twitter:

Uber-Tweet

At this stage the controversy surrounding Uber hasn’t affected their download rates or profits. But the scandal surrounding Uber should serve as a reminder to those in the start-up industry that implementing a strong HR department that is in sync with upper management is still vital to a company’s success.

 

Brihony Tulloch

March 21, 2017

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Acerca de Lucas Vargas:

  • Empezó en Grupo ZAP como el VP de Sales y en 2016 cuando la empresa tenía 60 empleados. Fue nombrado COO de VivaReal tomando el mando de Brian Requarth el Co-Fundador. VivaReal lanzó en Colombia y se trasladó a Brasil. En 2017 se hizo CEO del Grupo ZAP.
  • Ha trabajado en Mexico en PWC y en el Banco Santander
  • Tiene un Master de Business Administration de Harvard
  • En noviembre este año después de la fusión de OLX Brasil y Grupo ZAP fue nombrado el CEO del OLX Business Unit. Lidera la empresa junto con Andries Oudshoorn y Marcos Leite
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Simon Baker is the Founder and Executive Chairman of Online Marketplaces and Property Portal Watch. Involved with property portals for 15 years, he’s a well-recognized expert and industry consultant.
As former CEO/MD of the REA Group for 8 years, Simon led the group to its current market-leading position. When he joined REA Group in 2001, it had $4m in revenues, $6m in losses and an $8m market cap.
By 2008, the company presided over $155m in revenues, $35m in EBITDA and enjoyed a peak market cap of $1b. Simon is currently Chairman of the Mitula Group and Real Estate Investar and a serial portal founder and, investor.