Less than a day after we learned of a planned layoff of 5,400 employees at Uber, rival rideshare company Lyft just announced that it will lay off 17 percent of its workforce, or 982 people, in order to address losses that it faces due to pandemic lockdowns. And employees say they were mistakenly all sent an email earlier this week using an insensitive name for the cost-cutting project.
Lyft announced the move today in a regulatory filing with the Securities and Exchange Commission, and in addition to the layoffs, 288 employees will be furloughed for 12 weeks, and all remaining employees will take cuts to their base salary for 12 weeks starting in May. As CNBC reports, top executives will be taking a 30-percent reduction in pay, vice-presidents a 20-percent cut, and everyone else will take a 10-percent cut for three months.
As it pays out severance and benefits for laid off employees, the company expect to incur an extra $28 million to $36 million in second-quarter expenses.
In response to the cost-cutting measures, Lyft's stock was up 4 percent in afternoon trading, to around $34 per share. Lyft's stock hit a six-month high of $54 back in February before tanking with the rest of the stock market on March 18, bottoming out around $16.
News of layoffs to come reportedly spread like wildfire among the ranks of Lyft employees earlier this week after an email mistakenly was sent company-wide referring to a "Project Jetty," which some employees took to refer to the word "jettison." An anonymous source tells SFist that the email disappeared from inboxes but had been screenshot, and was being openly discussed on company Slack channels. Update: A source has subsequently shared what may be the email in question — it looks like it was actually a calendar invite with the title "Jetty" that referred to employees on "leave of absence."
"Employees are shocked at the insensitivity of the project name/email language at this time," the original source said said. "They have been promised layoffs are not happening following weeks of assurance from upper level authorities who have repeatedly emphasized the company’s vast amount of runway."
Another source within the company said that the word "jetty" in the project name was simply referring to a structure that extends into water to create safe harbor.*
An email has subsequently gone out to employees today, and reporter Kate Conger quotes it on Twitter as saying, "Even after stay-at-home orders are lifted, a looming recession will significantly reduce overall global spending, business travel, and major events. We did not initially have plans for layoffs, but now must be prepared for these implications."
Lyft is laying off 17 percent of its workforce and furloughing 5 percent. This is after an employment lawyer at the company accidentally invited much of the workforce to a weekend meeting called "Jetty" in what workers took to be a reference to jettisoning jobs.— kate conger (@kateconger) April 29, 2020
"Even after stay-at-home orders are lifted, a looming recession will significantly reduce overall global spending, business travel, and major events. We did not initially have plans for layoffs, but now must be prepared for these implications." -- Lyft email to employees— kate conger (@kateconger) April 29, 2020
In addition to the Uber layoff news — reported by The Information on Tuesday and likely still shaking out within the company itself — this week also saw layoffs at Boeing and San Francisco-based Juul Labs. After laying off 650 people last year, Juul is planning to further cut a third of its remaining workforce, or between 800 and 950 employees, according to the Wall Street Journal.
*This post has been corrected to show that no company meeting is scheduled for May 3.