Workplace relationship policies have come under the spotlight this week after it was reported that McDonalds is taking legal action against its former CEO, Steve Easterbrook, after he allegedly lied about sexual relationships with staff.
For those of you who missed it, Mr Easterbrook’s employment was terminated by McDonalds in November last year after he was found to have had a (consensual) relationship with an employee – contrary to the company’s policy regarding staff relationships which prohibits “any kind of intimate relationship between employees in a direct or indirect reporting relationship”. Mr Easterbrook walked away from his position with a settlement reported to be worth c.£35million.
However it has emerged over the past couple of days that findings of a further internal investigation at the company suggest that Mr Easterbrook had three additional relationships with staff and lied about this to the board. The implication is that Mr Easterbrook withheld relevant information to secure a more favourable exit package. McDonalds is now taking legal action against the former CEO to recover the settlement, which it claims it would not have approved had it been aware of this new information.
This is a headline grabbing case, however it also raises important considerations about the use of relationship policies more generally. These are still reasonably unusual outside of larger organisations but are becoming more common in the wake of the #metoo movement. Before #metoo, they were often seen as unfashionable and draconian, however they are now about more than potential conflicts of interest and can also make an important statement about a company’s values and approach to potential abuses of power within an organisation. The fact that McDonalds’ is not trying to keep this out of the public eye is an interesting example of this.
Mr Easterbrook is certainly not the first chief executive to be fired for inappropriate relationships with members of company staff and he won't be the last but this case stands out in one potentially very important way