McDonald’s CEO leaves firm after workplace romance

McDonald's Easterbrook
Steve Easterbrook.
Photo: PA Images

McDonald’s chief executive officer, Steve Easterbrook, has left the business after the board decided on Friday (1 November) that a relationship he had with a colleague contravened company rules.

According to McDonald’s the relationship, although consensual, demonstrated poor judgement and was not in accordance with the company’s workplace policies.

Easterbrook, in an email to staff, admitted his error and wrote: “Given the values of the company, I agree with the board that it is time for me to move on.”

Workplace romances: podcast

Why employers should be wary of workplace romances
XpertHR employment law editors Laura Merrylees and Stephen Simpson discuss problems that can occur when colleagues are in a relationship, and what HR can do to manage those issues.

McDonald’s directors voted on Easterbrook’s departure after conducting a review. According to a company spokesperson, details of his separation package will be released today (4 November) in a federal filing.

Watford-born Easterbrook, a former CEO with Pizza Express and Wagamama, joined McDonald’s as global chief brand officer in 2013, becoming CEO in 2015 and made a number of changes at the firm, introducing hormone-free milk and eggs from cage-free and antibiotic-free chickens. He also raised the lowest wages at the firm, perhaps remembering his own 1993 stint at the fast food giant as a branch manager in London.

In recent years he has been credited with helping revive the fast food giant’s fortunes and is said to be a rare example of a McDonald’s CEO with experience running other restaurant chains. He currently lives in Illinois.

McDonald’s board of directors named Chris Kempczinski, who recently served as president of McDonald’s USA, as its new president and CEO.

In June 2018, Intel Corp CEO Brian Krzanich resigned after an investigation found he had a consensual relationship with an employee that breached company policy.

Workplace relationships: key problems for employers

Employers responding to an XpertHR survey on workplace relationships found problems with:

  • complaints of favouritism from co-workers;
  • decreased morale of co-workers;
  • bullying or unpleasant behaviour between employees;
  • couple’s productivity decreasing; and
  • claims of sexual harassment.

Some large employers adopt a written policy on personal relationships at work. A typical policy will allow relationships between colleagues as long as they do not negatively influence the employees’ conduct in the workplace.

The policies maintained by some companies reserve the right when there is a conflict of interest to transfer one or both employees to another department, or to change their reporting lines.

Keely Rushmore, partner at SA Law told Personnel Today that the climate around work romances had changed in recent years: “Everyone is entitled to a private life, and that private life can extend into the workplace. However, work relationships can raise the legal risk that an employer is exposed to – particularly risks of claims of harassment and sex discrimination if the relationship doesn’t work out.

“Taking this into account, as well as the increased scrutiny to which employers and their employees are being subjected in the wake on the #MeToo movement, it’s perhaps not surprising that many employers now choose to implement a policy specifically addressing workplace relationships.”

Rushmore said it was unusual (and arguably overkill) for such policies to ban workplace relationships outright. But “it is sensible to outline an expectation of professional conduct, and to enable the employer to take steps to address relationships, particularly where one individual has direct or indirect management responsibility for or influence over the other. This could include permitting an internal transfer where feasible.”

She warned that although such a policy can provide some comfort to employers, “it won’t necessarily follow that any dismissal in breach of such a policy will be fair or discrimination-free. An employer would be required to have good reason for dismissing and a theoretical ‘risk’ may not be enough, and to follow a fair and reasonable process, including considering alternatives such as an internal transfer, prior to dismissing.”

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