McDonald’s Chief Forced Out after Relationship with Employee
The American fast food business McDonald's is known around the world and was in the news last weekend.
McDonald's Corporation announced that its chief executive officer, CEO, has been forced out of the company for having a consensual relationship with an employee.
The relationship was a violation of company policy, McDonald's said. And it accused CEO Steve Easterbrook, who also served as the company's president, of showing bad judgment.
McDonald's bars supervisors from having romantic relationships with employees who directly or indirectly report to them.
In an email to employees, Easterbrook admitted he had a relationship with an employee and that it was a mistake.
"Given the values of the company, I agree...that it is time for me to move on," Easterbrook said in the email.
McDonald's board of directors voted on Easterbrook's employment Friday after an investigation into his relationship. He will also be leaving the company's board of directors. Easterbrook was appointed as CEO in 2015.
McDonald's would not provide details about the employee with whom Easterbrook had a relationship. A lawyer for Easterbrook would not answer questions.
The board of directors named Chris Kempczinski as its new CEO and president. He recently served as president of McDonald's USA.
Two weeks ago, McDonald's reported a 2 percent drop in profits for the three month reporting period ending on September 30, 2019. During that period, the company said it spent a lot of money remodeling its stores and expanding delivery service. McDonald's also has reported that fewer people are going to its restaurants.
The leadership change is unrelated to McDonald's operational or financial performance, the company said in a press release.
McDonald's decision to remove its CEO may show there has been progress on workplace issues as a result of the #MeToo movement, said Carl Tobias. He teaches law at the University of Richmond.
"Other companies don't always act on that kind of information...and so it seems like they are trying to enforce a (strong) policy in this situation," Tobias said.
Last year, Brian Krzanich left his job as CEO of Intel Corporation after investigators found he had a consensual relationship with an employee that violated company policy.
In December, CBS Corporation removed its CEO, Les Moonves, after several women accused him of sexual harassment. The CBS board of directors denied him $120 million promised under his contract with the company.
Among other problems, McDonald's has faced workplace harassment charges. In May, the company said it was expanding anti-harassment training and offering a telephone hotline for workers to report problems. McDonald's made the changes after a labor group announced more than 20 sexual harassment cases against the company.
Fight for $15 is the name of the group that brought the sexual harassment charges. It said McDonald's answers to the charges were not good enough.
"The company needs to be completely (open) about Easterbrook," the group said.
Kempczinski joined McDonald's in 2015. He was responsible for nearly 14,000 McDonald's in the United States.
I'm Susan Shand.