April 29, 2020 / 4:03 PM / a month ago

Lyft to lay off 982 workers, cut salaries due to virus outbreak

FILE PHOTO: Uber and Lyft stickers are seen on a car windscreen as protesters join an Uber drivers' strike for higher wages at LAX airport in Los Angeles, California, U.S., May 8, 2019. REUTERS/Lucy Nicholson

(Reuters) - Lyft Inc (LYFT.O) said on Wednesday it plans to lay off 982 employees, or 17% of the company’s workforce, and implement pay cuts due to economic challenges caused by the coronavirus pandemic.

The company’s shares were up 5% in afternoon trading.

The ride-hailing business has suffered a near-total collapse as large parts of the United States remain shut to combat the spread of the virus.

Rival Uber Technologies Inc (UBER.N) is also discussing plans to cut around 20% of its staff following the virus outbreak, The Information reported on Tuesday.

Lyft said it will cut base salaries by about 30% for top executives, 20% for vice presidents and 10% for the rest, for a twelve week period beginning in May, in addition to furloughing 288 employees. (bit.ly/2KG7iXs)

The company said it estimates to incur about $28 million to $36 million of restructuring charges, primarily related to the layoffs, according to a regulatory filing.

Lyft directors have voluntarily agreed to forego 30% of their cash compensation for the second quarter of 2020, the company said.

Reporting by Munsif Vengattil in Bengaluru; Editing by Shounak Dasgupta

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