Uber CEO to take leave, leadership team to run company

The ride-hailing app, which has roughly 12,000 employees, hired the services of Holder to look into the company's work culture and contracted law firm Perkins Coie to review the specific harassment allegations.

Uber engineer Susan Fowler, posted a blog in February, stating on her first day, someone propositioned for sex.

She reported him to human resources and was told he would get a lecture but no further punishment because he was a "high performer", she wrote.

Among other recommendations, the report also suggested that the company should explicitly prohibit intimate or romantic relationships between an employee and his or her supervisors, and significantly increase its efforts to hire a more diverse workforce.

What's more, even when Kalanick returns, his responsibilities would likely be reduced, The board has chose to accept all of the recommendations presented before it and among them, was one which said that Kalanick's responsibilities should be reduced and a COO found as soon as possible. "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", he added.

Kalanick became CEO of Uber in December 2010, replacing Ryan Graves, who sits on the company's board and serves as its senior vice president of global operations. Chief Business Officer Emil Michael, one of Kalanick's key lieutenants, left the company on Monday, according to a source familiar with the situation, a departure that news reports have tied to the Holder investigation.

Kalanick announced his leave in a sometimes strangely worded, company-wide email, in which he expresses his desire to "work on Travis 2.0" in order to be able to better construct a leadership team for Uber's future. The company's board of directors unanimously approved the proposed changes on Sunday.

It said the company should "review and reallocate responsibilities of Kalanick", and that creating the job of chief operating officer, which was discussed in recent months, "should address this concern to some extent".

Uber "should reformulate its written cultural values because it is vital that they reflect more inclusive and positive behaviours", his report said. But Lyft Inc. has stolen some market share in the USA, and Uber's internal strife could open opportunities for competitors globally to lure partners, raise funds or poach talent.

After Fowler posted her blog, Uber Technologies Inc. made changes in human resources and opened a 24-hour hotline for employees. The report also called for the appointment of a senior executive to oversee the implementation of its recommendations. That investigation, which was separate from Holder's, checked into 215 complaints; 57 are still under investigation. It would also give Kalanick a chance to take board member Arianna Huffington's advice.

He says just like many successful startups, Uber's rapid growth likely outpaced its ability to put in necessary safeguards and policies.

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