McDonald’s has clawed back more than $105 million in severance benefits from a former CEO accused of lying about inappropriate workplace relationships.
British executive Steve Easterbrook agreed to return the cash and equity awards and issued a groveling apology saying he failed to ‘uphold McDonald´s values’ as part of the settlement announced Thursday.
McDonald’s terminated Easterbrook after he sent racy texts and videos to an employee in a consensual, non-physical relationship. Later, he was sued by McDonald’s for claiming he had consensual relationships with three workers.
‘During my tenure as CEO, I failed at times to uphold McDonald´s values and fulfill certain of my responsibilities as a leader of the company,’ Easterbrook said in a prepared statement issued Thursday by McDonald’s.
“I have to apologize for my past co-workers and board, as well as the franchisees of the company and their suppliers.
After he sent racy texts and videos to an employee, McDonald’s terminated Easterbrook.
McDonald’s is suing Steve Easterbrook, former CEO of McDonald’s. He has been accused of lying about workplace relationships and earning more than $105M in severance payments.
McDonald´s fired Easterbrook in late 2019 after he acknowledged exchanging videos and text messages in a non-physical, consensual relationship with an employee.
Easterbrook stated that there weren’t any other instances like this at the time of Easterbrook’s firing. A look at his cellphone seemed to support his claim.
Easterbrook is shown with Denise Paleothodoros (his ex-girlfriend), whom he dated between 2014 and 2018.
McDonald´s board approved a separation agreement ‘without cause’ that allowed Easterbrook to keep tens of millions in stock-based benefits and other compensation.
A tip by an employee in July 2020 claimed that Easterbrook was in a sexual relationship.
After an investigation, McDonald´s confirmed that relationship as well as two other physical, sexual relationships with employees in the year before it fired its top executive. McDonald’s claimed Easterbrook had deleted all evidence related to those relationships from his cellphone.
McDonald´s board sued Easterbrook in August 2020, saying it wouldn´t have terminated him without cause if it had known the extent of his misconduct.
The complaint said that the evidence included dozens of sexually explicit photos and videos, some partially or nude, of women from various countries, as well as photographs taken by employees of the company.
McDonald´s fired Easterbrook in late 2019 after he acknowledged exchanging videos and text messages in a non-physical, consensual relationship with an employee
The email stated that Easterbrook sent the photos, which were said to have been taken late 2018, and early 2019, to an attachment to messages from his company account. It also indicated that Easterbrook was sending them to his personal account.
Easterbrook claimed in his defense to the suit that McDonald’s knew about Easterbrook’s relationships when it was negotiating his severance packages.
The company sought the return of equity awards granted in 2018 and 2019, since Easterbrook´s separation agreement made clear he would forfeit those if the company determined he had engaged in ‘detrimental conduct.’
The settlement announced Thursday holds Easterbrook accountable and affirms the board’s decision to pursue the case, McDonald´s Chairman Enrique Hernandez Jr. said in a prepared statement.
The settlement announced Thursday holds Easterbrook accountable and affirms the board’s decision to pursue the case, McDonald´s Chairman Enrique Hernandez Jr. said
Hernandez explained that Hernandez was able to resolve the matter without having to go through a long court procedure and now can move on.
Easterbrook was the victim of a wider scandal at the company, which included sexual harassment within its ranks.
At least 50 workers filed complaints against the company over the past five-years, alleging harassment, verbal and physical violence, as well as retaliation for coming forward.
In October 2019 — a month before Easterbrook was fired — McDonald´s introduced a new harassment training program for its 850,000 U.S. employees, but franchisees weren´t required to provide it.
McDonald’s went further in April saying it would require new training at its restaurants to fight harassment and discrimination.