Uber Investigation Alone Won't Solve Company's Problems, Employment Lawyers Say

The Recorder - February 24, 2017 - By: David Ruiz

SAN FRANCISCO—A former engineer’s published allegations that she was sexually harassed at Uber Technologies Inc. during her tenure at the ride-sharing company created ongoing tumult that is unlikely to be settled solely by an internal investigation launched in its aftermath, labor and employment lawyers and experts say.

"The way this is being handled now could create a significant chilling effect and preclude perhaps many other female sexual harassment victims from coming forward," said Kelly Armstrong, founding partner of The Armstrong Law Firm, a plaintiffs firm in San Francisco. Armstrong said she has been contacted by several female engineers at Uber since the controversy broke earlier this week.

Armstrong said the approach could even backfire: By hiring Covington & Burling and the firm’s marquee partner, former U.S. Attorney General Eric Holder Jr., Uber has made the process even more public, which could make sexual harassment victims feel less safe, she said.

"In general, most female sexual harassment victims are very afraid to come forward because of fear of retaliation," Armstrong said. "Now that Travis Kalanick has made this investigation so public, both nationally and internationally, it potentially will cause other female sexual harassment victims to not come forward because they won’t want their names in the press."

Armstrong continued: "It’s a double-edged sword because, on the one hand, given that a woman came forward and had the courage to do that—and it appears that her complaint is now finally being taken seriously—that would normally give other women the courage to come forward."

However, Armstrong said, "given international publicity now focused on this, it could then have a boomerang effect where the same women who otherwise had courage to come forward no long want to or feel safe doing so."

The controversy comes at a difficult time for Uber.

Last month, Uber suffered backlash from its decision to pick up customers at New York City airports during a demonstration by the Taxi Workers Alliance protesting the Trump administration’s executive order restricting travel from seven majority-Muslim countries. Customers upset by the sex discrimination allegations earlier this week reignited the #deleteUber campaign that began during the travel ban protests and removed their accounts, prompting a contrite response by the company.

Meanwhile, Uber continues to battle regulators in states over attempts to require drivers to submit to criminal background checks, partly in response to instances of alleged sexual assaults by drivers in this and other countries among the 70 where the company operates; and a study that suggested that Uber and a competitor, Lyft, racially discriminate against minority customers, prompting an inquiry by Sen. Al Franken, D-Minnesota.

And Uber faces a new lawsuit—from an investor, Alphabet Inc., the parent company of Google—over alleged trade-secret theft. Alphabet alleged in the suit, filed Thursday in San Francisco federal district court, that a former employee stole intellectual property about self-driving vehicles and took it to Uber.

Former Uber engineer Susan Fowler’s blog post this week detailing her harassment claims against the company set off a firestorm in Silicon Valley and renewed criticism that tech companies haven’t adequately confronted pervasive gender bias.

Fowler, who presented allegations of repeated harassment by a direct supervisor, said her complaints to human resources and other managers were rebuffed because her accused harasser was a top performer. Some labor and employment lawyers questioned whether Uber’s in-house counsel and human resources department appropriately handled the situation. Uber CEO Travis Kalanick reportedly apologized in the aftermath of Fowler’s claims.

Fowler, who said she left Uber in December, would not elaborate on her claims when reached by email by The Recorder. She would not say whether she intended to sue the company or her manager, and she declined to discuss the matter further. In the essay, Fowler said she has been employed since January at Stripe Inc., a San Francisco company that processes online payments for companies.

According to records from the California Department of Fair Employment and Housing, six discrimination complaints were filed against Uber from July 1, 2012, through Dec. 20, 2016. None, however, specifically alleged sexual harassment. Records of complaints that may have been filed with the U.S. Equal Employment Opportunity Commission in San Francisco could not be immediately obtained.

Holder and fellow Covington partner Tammy Albarrán, a San Francisco-based litigator, will lead the internal investigation. The investigatory panel includes Uber board member and Huffington Post founder Arianna Huffington, Uber’s chief human resources officer Liane Hornsey, and associate general counsel Angela Padilla, and other several executives. The former head of human resources at Uber, Renee Atwood, left Uber in August 2016 and is now chief human resources officer at Twitter. Atwood did not respond to a request for an interview.

The panel since been criticized by some as more of an attempt at public relations crisis-management than an effort likely to result in serious changes of culture at the Silicon Valley firm. Some critics have questioned the panel’s independence.

Responding to critics, Holder released a statement Thursday to the publication BuzzFeed News that said: "I will put my personal reputation behind everything that I say. I think I’ve demonstrated throughout my career the ability to be independent, to not be afraid to express contrary views, and that’s what I’ve told everybody here at Uber."

University of Washington School of Law assistant professor Elizabeth Tippett, a former employment law attorney at Wilson Sonsini Goodrich & Rosati, who wrote a Washington Post op-ed this week anchored by the claims against Uber, said appointing a panel alone isn’t enough.

"What you need is an appetite and willingness on the business side to actually do something on the recommendations from the investigation," she said in an interview.

Tippett, writing in the Post, said one mistake companies often make is failing to address problems such as harassment as a serious business issue until they publicly erupt.

"As I learned while working as an employment lawyer at a large law firm, legal mandates rarely disrupt business objectives," she wrote. "Instead, they are largely viewed as an inconvenience delegated to HR. That explains, for example, why the CEO learned about Fowler’s allegations only after they went viral."

The Recorder spoke with Tippett on Thursday about her observations and about Uber’s handling of Fowler’s allegations. The conversation was edited for length and clarity.

The Recorder: When HR does get a legal issue, how easy is it to inform the in-house legal department?

Tippett: It varies and depends on the head of HR—how high they are in the organization and whether they report directly to the CEO or to someone else. The head of legal is often in a position to get the CEO’s attention, so it may be that HR needs to tell legal, who needs to tell the CEO. That might be the most direct route to the CEO, but it varies a lot, and it changes as companies grow.

Can the Covington & Burling-led investigation produce any results to bring actual change?

Sometimes, what companies do is they’ll hire these expensive investigators because they don’t want to deal with the problems. They think the act of hiring an expensive law firm to do a big expensive investigation addresses their responsibilities to do anything, that the fact of the investigation discharges their responsibility. Whereas, I think others are willing to do this because they want to use it as a sign of their commitment to this issue.

But it’s not the investigation itself that is going to produce change. What you need is an appetite and willingness on the business side to actually do something on the recommendations from the investigation, or to take initiative after the investigation comes out to do things differently and to re-examine the corporate culture, as opposed to just putting it on the shelf and saying, "Wow, we paid for this investigation, and now we’re going to go about business as usual."

Will the investigation produce new policies or potential changes to the employee handbook?

I don’t think anything prevents them from making recommendations like that but they can make all the recommendations in the world and nothing will be done if no one is interested in doing anything.

What should or could Uber do to steer itself in the right direction?

Here’s the advice I would give any company. It’s easy to say, "We’re against discrimination and discrimination is something that happens somewhere else." It’s much harder to say we as a company—and I as an individual—have probably contributed to the problem of discrimination. We acknowledge the things we’ve done in the past that we’re not proud of or that we could’ve done better. We could’ve done a better job of promoting people underneath us or mentoring them or recruiting women or minorities and being honest with ourselves about the ways in which we’ve contributed to the problem and dedicating ourselves to do a better job every day for the people around us. That, I think, is actually really hard.