McDonald’s reclaims tens of millions from ex-CEO — Analysis
US fast food chain McDonald’s has settled a lawsuit against former CEO Steve Easterbrook involving the return of equity awards and cash worth over $105 million, amid a dispute about personal relationships during his tenure.
On Thursday, McDonald’s said it had recovered severance pay worth $105 million from Easterbrook. “Today’s resolution avoids a protracted court process and moves us beyond a chapter that belongs in our past,” the chain’s chairman, Enrique Hernandez Jr, said in a message to employees seen by Reuters.
Easterbrook was dismissed in November 2019 by the firm after they discovered that he had been involved in consensual relationships with employees. In spite of the revelations, he was offered a severance deal.
However, a tip later alerted McDonald’s to the fact that Easterbrook had lied about the extent of his relationships with employees during an initial probe into his behavior. Further investigation revealed that dozens more explicit sexually explicit photographs of women were found, three of which were taken by employees. These photos had been sent from Easterbrook’s company email to his personal account.
In August 2020, nine months after a severance package was agreed to, McDonald’s sued Easterbrook, alleging that he had failed to give a complete picture of his relationships to company directors. The former boss hit back, claiming McDonald’s had information on his relationships on its computer systems when it negotiated his severance package.
In a statement provided by McDonald’s on Thursday, Easterbrook admitted that he failed to meet the standards expected of him while serving as its chief executive. “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. I apologize to my former co-workers, the Board, and the company’s franchisees and suppliers for doing so,”Easterbrook said it.