The former chief executive of McDonald’s returned $105 million in cash and stock to the fast-food giant in a historic settlement that comes two years after he was fired for having a sexual relationship with an underling at the company.
The nine-digit clawback from Steve Easterbrook — which represents the severance he was given to walk away from the company in November 2019 after his affair was revealed – was accompanied by an apology from the former CEO.
That’s because McDonald’s later discovered that Easterbrook had lied to the board about other sexual relationships he had with female employees during its investigation. The company sued him to get the money back.
“McDonald’s and its Board of Directors value doing the right thing and putting customers and people first,” Easterbrook said in a written apology on Thursday. “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 that was slated to begin in Delaware Chancery Court in May.
“This settlement holds Steve Easterbrook accountable for his clear misconduct, including the way in which he exploited his position as CEO,” chairman of the board, Enrique Hernandez said in a statement.
Several months after Easterbrook left, McDonald’s learned through a tipster that he’d also had a sexual relationship with another female employee. McDonald’s said an investigation 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 Easterbrook to recover his generous compensation and severance package and he countersued. The investigation found that he’d relationships with three McDonald’s employees, including a PR advisor, and that he’d lied to the company about them, which prompted the lawsuit.
Easterbrook wasn’t the only one canned at McDonald’s for bad behavior.
McDonald’s also axed David Fairhurst — the former HR chief who reportedly drank with other employees — over conduct that was inconsistent with the company’s values and policies. McDonald’s initially said Fairhurst had left the company, and Fairhurst said last fall that he had decided “to move on to my next career challenge.”
McDonald’s learned about the second relationship Easterbrook had and the problems with the HR executive through a tipster.