Lyft CEO slashing jobs as ride-sharing company struggles

Ride-hailing company Lyft is “significantly reducing” its workforce as it faces difficulty in generating a profit, according to David Risher, the company’s new CEO.

What’s happening: Reuters confirmed that this round of layoffs affects 1,072 employees.

• This represents approximately 26% of its entire workforce, a number that Lyft has not yet confirmed.
• Risher sent a memo to staff on April 21 explaining that the cuts are designed to make Lyft a “faster, flatter company where everyone is closer to our riders and drivers.”
• “I own this decision and I understand that it comes at an enormous cost.”
• A Lyft spokesperson said that “the result will be a far stronger, more competitive Lyft.”

Further explanation: The layoffs come as Lyft faces ongoing challenges related to the economy and stiff competition.

• Lyft previously let 60 employees go in July 2022, and cut as many as 700 jobs in November 2022.
• The company hasn’t kept up with Uber’s efforts to diversify its business by expanding into meal and grocery delivery. Uber’s most recent earnings report marks its strongest quarter ever.
• Lyft’s shares are down roughly 70 per cent from this time last year.
• Risher was made CEO in April following the departure of co-founders Logan Green and John Zimmer. Risher was a longtime senior employee at Amazon who was originally hired as the company’s 37th employee.

Exit packages: Lyft’s memo to staff identifies support for terminated employees, likely those working in the United States.

• At least 10 weeks of pay, with more for employees with over four years of service.
• Healthcare coverage through October 31, 2023.
• Accelerated equity vesting for the May 20 vesting date.
• Career resources and counselling.

Impact on Canadian staff

Lyft’s layoffs may include a number of Canadian employees, however the full impact is currently unclear as the company has not confirmed any cuts.

Major tech layoffs continue

Lyft joins the ever-expanding list of major North American tech companies that have announced sweeping layoffs in 2023.

Several big names, including Amazon, Meta, Alphabet, Dell, Clearco, Hootsuite, Kyndryl, F5, CDW and Microsoft, have significantly scaled back their staffing levels as they continue to navigate challenging economic conditions.

SEE ALSO
• Employment lawyer on recent tech layoffs and severance
• Layoffs in Canada
• Severance pay by job in Canada

Termination packages for Lyft staff

In Canada, non-unionized employees at Lyft are owed full severance pay when they lose their jobs due to downsizing or corporate restructuring.

This includes individuals working full-time, part-time, or hourly in Ontario, Alberta, and B.C.

Severance can be as much as 24 months’ pay, depending on a number of factors.

LEARN MORE
• Severance for technology industry employees
• Severance for provincially regulated employees
• Severance packages in mass layoffs

WATCH: Employment lawyer Lior Samfiru explains what rights employees have if they are being fired or let go on an episode of the Employment Law Show.

Before you accept any severance offer, have an experienced employment lawyer at Samfiru Tumarkin LLP review it and your employment contract.

We can tell you if what you have been provided is fair and how to get proper severance if it falls short of what you are actually owed.

If you don’t receive the full amount, which happens often, you have been wrongfully dismissed and are entitled to compensation.

Employers sometimes use pressure tactics to try to coerce employees into accepting poor severance packages, such as imposing a deadline for accepting the offer.

However, in Canada, terminated employees have up to two years from the date of their dismissal to pursue a claim for full severance pay.