Former McDonald’s boss to lose US$105m in sexual harassment lawsuit

In a historic settlement, Steve Easterbrook, former chief executive of McDonald’s, returned $105 million in cash and stock to the fast-food company.

McDonald's

The nine-digit settlement comes two years after Easterbrook was given severance to leave the company in November 2019 after a sexual relationship with a junior staff colleague was revealed.

The case arose because McDonald’s later discovered Easterbrook had lied to the board about other sexual relationships with female employees during its investigation. The company sued him to have the severance payments returned.

In a written apology, Easterbrook said, “McDonald’s and its Board of Directors value doing the right thing and putting customers and people first. 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.”

The settlement avoids a trial going forward that had been scheduled to begin in May.

“This settlement holds Steve Easterbrook accountable for his clear misconduct, including the way in which he exploited his position as CEO,” said Enrique Hernandez, McDonald’s Board Chairman.

Several months after Easterbrook left, a whistleblower told McDonald’s that the former CEO also had a sexual relationship with another female employee.

After an investigation that uncovered “dozens of nude or partially nude photographs and videos of various women that Easterbrook had sent as attachments to messages from his company email account to his personal email account,” McDonald’s sued him to recover his compensation and severance package.

According to the investigation, Easterbrook had relationships with three McDonald’s employees, including a PR advisor, and lied to the company about them, which prompted the lawsuit.

McDonald’s also fired former HR head David Fairhurst for conduct that was deemed inconsistent with the company’s values and policies, after he reportedly drank with other staff members.