As part of a “plan of termination,” San Francisco ride-hailing giant Lyft will lay off 982 workers to cut costs amid damage from the coronavirus pandemic, the company said in a regulatory filing Wednesday.
The employees to be laid off amount to 17% of Lyft’s workforce, it said in the filing with the Securities and Exchange Commission. Lyft does not classify its army of drivers as employees.
Cost-cutting efforts have also led the company to furlough about 288 workers and cut base salary by 20% to 30% for executives, while Lyft’s board has agreed to forego 30% of their cash compensation for the second quarter of 2020, the filing said.
The outbreak, and its associated stay-at-home orders, has devastated the ride-hailing business.
“The pandemic began to have a negative impact on business trends, including ride volumes, in mid-March, which has continued into April,” Lyft said in an SEC filing April 21. Company rival Uber has not announced job cuts, though a recent report suggested its executives were considering them.
Lyft, which saw its revenues skyrocket to $3.6 billion in 2019 from $343 million in 2016, has also seen its losses grow year after year, to $2.6 billion last year from $683 million in 2016, according to its most recent annual report. Relying on hundreds of thousands of drivers it does not classify as employees, Lyft is fighting the State of California over the new law AB-5 that designates as employees many workers deemed contractors by their employers.
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