McDonald’s sues former boss Steve Easterbrook for lying about relationships

McDonald’s is taking legal action against its former chief executive Steve Easterbrook, who was sacked last year over a relationship with another employee, alleging that he should not have been given severance pay because he “concealed evidence and lied about his wrongdoing”.

The Briton had originally admitted to having a consensual relationship with an employee, but the company received from an anonymous tip in July that led it to investigate further. It concluded he had been involved in sexual relationships with three other McDonald’s employees before his exit, according to a company filing on Monday.

The evidence also shows Mr Easterbrook approved a special discretionary grant of restricted stock units worth hundreds of thousands of dollars to one of the employees after their first sexual encounter – and just days before their second, the company said.

As a result, the fast food chain filed a complaint in the Delaware Chancery Court to recover any compensation and severance benefits that he received when he departed. The company has also taken steps to prevent Mr Easterbrook from exercising any stock options or selling any shares.

He was given $675,000 in severance and health insurance benefits and share options worth more than $37m (£31m) last November, according to Bloomberg calculations.

Chris Kempczinski, who took over as chief executive following Mr Easterbrook’s departure, told employees about the legal action in a memo on Monday.

“We recently became aware, through an employee report, of new information regarding the conduct of our former CEO, Steve Easterbrook,” he wrote.

“While the board made the right decision to swiftly remove him from the company last November, this new information makes it clear that he lied and destroyed evidence regarding inappropriate personal behavior and should not have retained the contractual compensation he did upon his exit.”