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McDonald’s sues fired CEO Steve Easterbrook

According to the lawsuit,ousted McDonald’s CEO Steve Easterbrook lied to the board about the extent of his relationships with employees and he misled investigators about engaging in physical sexual relationships with three employees in the year before he was fired.

Now, McDonald’s is suing Easterbrook for the amount of his exit payout,about $40 million.

 

The company fired Easterbrook in November after a consensual relationship with a subordinate which amounted to sexting. At the time, McDonald’s board said the executive had violated company policy and “demonstrated poor judgment” by engaging in the relationship with an employee.
As part of compensation, Easterbrook was promised 26 weeks severance pay, in addition to prorated bonuses as warranted. Those benefits amounted to about $42 million, according to outside firm Equilar.
An anonymous tip in July about a second relationship between Easterbrook and another employee led the company to revisit the case.Sexually explicit photos and videos of the three women, that Easterbrook had attached to emails from his corporate account to his personal account,were found on the company’s server. Easterbrook even “approved an extraordinary stock grant, worth hundreds of thousands of dollars” for one of them.
The company alleges that by lying to the board, Easterbrook led them to believe that his firing could be considered “without cause.” The board ultimately landed on that designation, which entitled Easterbrook to certain outgoing benefits, the suit alleges.

In a note to employees on Monday, current McDonald’s CEO Chris Kempczinski said that “McDonald’s does not tolerate behavior from any employee that does not reflect our values.”

“We now know that Easterbrook’s conduct deviated from our values in different and far more extensive ways than we were aware when he left the company last year,” Kempczinski said. “While the Board made the right decision to swiftly remove him from the Company last November, this new information makes it clear that he … should not have retained the contractual compensation he did upon his exit.”

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