Uber lays off 3,700 workers in coronavirus, CEO waives salary

'There isn't enough work,' Uber spokesperson says

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Uber is letting go of 3,700 full-time employees, 14 percent of its staff, and CEO Dara Khosrowshahi is waiving his salary for the rest of the year, the rideshare and delivery company disclosed Wednesday.

Khosrowshahi's salary was $1 million in 2019.

Uber and competitor Lyft's rideshare businesses have taken a significant hit due to COVID-19 as people abide by local stay-at-home policies and avoid public transit and rideshare apps.

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"With people taking fewer trips, the unfortunate reality is that there isn’t enough work for many of our front-line customer support employees," an Uber spokesperson told FOX Business.

A driver displaying Lyft and Uber stickers on his front windshield drops off a customer in downtown Los Angeles. (AP Photo/Richard Vogel, File)

"Since we don't know how long a recovery will take, we are taking steps to bring our costs in line with the size of our business today," the spokesperson said. "This was a tough decision, but it is the right one to help protect the company's long-term health and ensure we come out of this crisis stronger."

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Uber has reduced its business partner operations workforce by more than half and its BPO-spend by millions of dollars, it said.

TickerSecurityLastChangeChange %
UBERUBER TECHNOLOGIES INC.36.43-0.32-0.87%
LYFTLYFT INC.36.08+1.64+4.75%

Since the company is not hiring new workers, talent acquisition employees have also been laid off. About 40 percent of Uber's global "Greenlight Hubs," or offices where drivers can seek in-person help, will be closed, according to the company.

Lyft revealed April 29 that it had laid off 982 employees and furloughed even more as the coronavirus pandemic continues to hit the economy.

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Lyft co-founders John Zimmer and Logan Green have pledged to donate their salaries until June. The company's executives will also have a 30 percent salary reduction, vice presidents will have a 20 percent salary reduction and the rest of Lyft’s salaried employees will have a 10 percent salary reduction.

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Uber reduced rideshare costs at the outset of the virus to meet customer needs and stopped its Uber Pool service in which a driver picks up multiple people along one route to save time and money.

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One bright spot: Uber has seen an increased demand for food delivery due to the coronavirus. In order to keep up, Uber announced in April that it would expand its delivery services and offer 10 million free rides and delivers to people in need. The company has teamed up with companies like Tim Horton's and Stop & Shop to help deliver food to seniors and others forced to shelter in place.

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FOX Business' Lucas Manfredi contributed to this report.