McDonald's is suing its former chief executive officer (CEO) Steve Easterbrook for lying to the board about his sexual relationships with employees.
In the lawsuit, McDonald's said Steve Easterbrook misled investigators about him engaging in physical sexual relationships with three employees in the year before he was ousted. The fast food chain is suing its ex-CEO for the amount of his exit package.
Easterbrook's ouster
In November 2019, Easterbrook stepped down as CEO and president of McDonald’s. According to McDonald’s, the board has determined that he violated company policy for his consensual relationship with an employee.
In a statement, the company said Easterbrook "demonstrated poor judgment involving a recent consensual relationship with an employee."
Easterbrook expressed regret over the relationship and sent an email to McDonald’s employees saying: "As for my departure, I engaged in a recent consensual relationship with an employee, which violated McDonald’s policy."
"This was a mistake. Given the values of the company, I agree with the board that it is time for me to move on. Beyond this, I hope you can respect my desire to maintain my privacy,” he added. He also said that his time at the helm of the company “have been the most fulfilling years of my working life."
He was replaced by Chris Kempczinski, who joined the company in 2015 and previously served as president of McDonald’s USA.
In a statement, Kempczinski said that he is "energized by this challenge" and looks forward "to guiding McDonald’s continued success."
The company’s board has expressed confidence in Kempczinski’s ability to lead employees. Enrique Hernandez Jr., chairman of McDonald’s board of directors, said: "Chris takes the reins of this great company at a time of strong, sustained performance. The board has every confidence that he is the best leader to set the vision and drive the plans for the company’s continued success."
Internal investigation
McDonald's conducted an internal investigation and found other relationships and evidence that Easterbrook lied and destroyed records to hide his behavior.
The company said: "The investigation confirmed that the alleged relationship had occurred and revealed that it had been a non-physical, consensual relationship involving texting and video calls," referring to the sexting relationship with an employee it referenced during Easterbrook's exit.
However, results of the reopened investigation disputes the former chief's claim that this relationship was "the only one of an intimate nature" that he had ever maintained with an employee and that he'd never had a physical sexual relationship with someone who worked for him.
An anonymous report in July accused Easterbrook of having a physical sexual relationship with an employee while he was CEO.
The new probe discovered that he engaged in physical sexual relationships with three employees in the year before he was terminated.
According to McDonald's the evidence for those relationships were "dozens of nude, partially nude, or sexually explicit photographs and videos of various women," which included photographs of the three employees, that he allegedly sent on emails from his work to his personal account.
They also found that Easterbrook "approved an extraordinary stock grant, worth hundreds of thousands of dollars, for one of those employees in the midst of their sexual relationship."
McDonald's argued that by lying to the board, Easterbrook led them to believe that his firing could be considered "without cause", which entitled him to certain outgoing benefits.
The terms of his resignation included 26 weeks severance pay, in addition to prorated bonuses as warranted, which outside firm Equilar estimates to about $42 million.
