Uber is currently in the midst of yet another recent scandal. Last February a female engineer at Uber reported multiple cases of sexual harassment from her fellow male employees and human resources’ pitiful attempt to resolve the issue led to an outpouring of other reported cases of sexual harassment.  Former U.S. Attorney General Eric Holder’s law firm was called in to investigate the company’s culture and the recommendations from the firm will be released to Uber employees tomorrow. The recommendations set out by Holder’s firm are expected to force greater controls on spending in human resources in areas where top executives have a lot of power. There have also been talks of Travis Kalanick, CEO temporarily stepping away from and possibly returning to Uber with a position of less authority.

Why does this still happen?

Most decisions that lead to ignoring sexual harassment accusations in the workplace stem from the fact that male executives have never experienced such harassment and are therefore apathetic to female workers’ complaints. However a lot of these cases come down to simple math from the point of view of executives that have the power to settle these disputes. One can either incur the costs of finding replacements for the accused or they can incur the costs of sexual harassment claims. Many times, finding replacements for key workers is the more costly alternative and therefore the accusations don’t make it past Human Resources.

Human resources is often overlooked as a very basic form of corporate politics and is often the first department to get slashed if a company is strapped for cash. However a large company without a developed HR department will ultimately end on the same path as Uber. A company’s people is its biggest asset and formulating incentives and workplace behavior guidelines is essential for a company to be a friendly work environment for all its employees and therefore, operate as best as possible.