Source: McDonald’s
Should McDonald’s CEO have been fired over a ‘consensual relationship’?
Steve Easterbrook has generally gotten positive marks for the changes that he has made since taking over as CEO of McDonald’s in 2015. Mr. Easterbrook, who previously served as the fast food chain’s chief brand officer and ran some of its European divisions before that, presumably knows as much as anyone when it comes to McDonald’s corporate culture and rules of conduct. That’s what makes yesterday’s announcement that McDonald’s board fired him after learning that “he violated company policy and demonstrated poor judgment involving a recent consensual relationship with an employee” all the more puzzling.
In an email to employees, The New York Times reports, Mr. Easterbrook wrote that he had made “a mistake” and agreed with the board that “it is time for me to move on.” McDonald’s has not released details about the relationship or how it came to the attention of the company’s board.
The fact that Mr. Easterbrook had a relationship with a co-worker is not unusual. Office romances, for better and worse, have been a feature of the workplace probably for as long as there have been workplaces. That a person in a position of privilege within a business organization chose to ignore rules that apply to others is also not novel. From the outside looking in, however, it seems particularly odd in the age of #MeToo and allegations of sexual wrongdoing from Hollywood to the White House that Mr. Easterbrook would have knowingly put himself in this position, consensual relationship or not. All that matters, at this point, is that he did.
McDonald’s has named Chris Kempczinski, most recently the chain’s president of its U.S. business, as its new president and CEO, effective immediately.
“Chris takes the reins of this great company at a time of strong, sustained performance, and the board has every confidence that he is the best leader to set the vision and drive the plans for the company’s continued success,” said Enrique Hernandez Jr., McDonald’s chairman, in a statement. “He has the right mix of skills and experience to lead us forward having run our U.S. business, where franchisees are delivering strong financial and operational results, and overseen global strategy, business development and innovation. In particular, Chris was instrumental in the development of the company’s strategic plan, which has enabled global growth and leadership, and has overseen the most comprehensive transformation of the U.S. business in McDonald’s history.”
Discussion Questions
DISCUSSION QUESTIONS: Should retailers and other businesses set rules that prohibit personal relationships between co-workers, regardless of their positions in the company? If not, what policies should companies set to handle such occurrences?
Poll
BrainTrust
Nikki Baird
VP of Strategy, Aptos
Georganne Bender
Principal, KIZER & BENDER Speaking
Lead by example, others will follow. If this is the policy set within the company, it applies to all. As noted in the article, this is not the first time this has happened in a Fortune 500 company — it pretty much erases all the good that leader has accomplished. He, as others in the past, will be remembered for that incident and not for the years of hard work to turn around a company.
I have to say, out of this story the most surprising part was that the company forbids relationships with employees. That seems a bit draconian. As long as one employee is not in a position to control the fate of the other’s employment, there seem to be plenty of companies who have figured out how to make that work. Even for a CEO, just have someone else be responsible for reviews and evaluations. The fact that a CEO completely ignored these rules – when he had a high probability of being able to change them – speaks to a very large lapse in judgment. That McDonald’s chose not to sweep it under a rug as so many other companies have, is important. But I also feel like the company needs to get with the times. People thrown together are going to form relationships. Rather than ban that and expect something inhuman, maybe just try to manage it a little better.
Nikki! You are so right! The policy itself seems to set up employees for failure and is outdated thinking especially since many people meet their significant others at work. Setting up a policy of notifying the employer when people have personal relationships allows for better decisions in regards to determining the impact of work performance and/or favoritism.
These policies have been in place in various industries for a long time. My sister had to quit her job as a bank exec almost 30 years ago because she was falling in love with her boss. It’s an oddity, and I do wonder what the risk is — it does seem like a holdover from another era.
Yes, Nikki, at the risk of getting dinged for this, I agree. My goodness one of the co-founders of a major company in my city met, dated and married an employee. When I was there doing some work and a company meeting was called, they even had her speak. Why did this work as it did? Full disclosure. But let’s not kid ourselves, surely they dated a bit before they decided to make full disclosure. I would bet he told his co-partner and possibly some others just to be above board. Therein lies the difference between a MeToo and a possible future wife. And that’s my 2 cents.
Not sure I agree, Nikki. In theory, a company should be able to handle these situations by putting proper rules in place, but we all know the reality is that men (especially) in positions of power can pressure women into relationships, and even if that employee is not reporting directly to him, she might fear suffering repercussions were she not to play along. I’m not sure that not reporting directly to that executive would make much difference. It would depend on the chains of intimidation running throughout the organization.
I agree, Rick. Not to mention the unfair advantage other employees might perceive this particular employee having as a result of a romantic relationship with the CEO. Call me a killjoy, but I think this is entirely inappropriate at CEO level–and unhealthy for the organization for lower level employees of differing positions in the hierarchy, too. Ultimately, this should be mapped out in company policy, but determined on a case-by-case basis.
Rick, it’s critical to note that coercion is about power and not gender specific. As glass ceilings continue to shatter the potential for either gender to coerce or be coerced increases. I note that you said, “… men (especially) … ,” but it is important to remember that, even now, that doesn’t mean, “exclusively.”
What is it about men in power feeling like the rules don’t apply to them? And he was let go — he couldn’t argue with it and yet arguably he made a huge impact on McDonald’s. I can’t believe a person of that much influence and wealth couldn’t have found somebody outside of work to have developed a relationship with.
One can argue both sides of this question. Most people who work spend most of their waking life at work so it is unrealistic that these relationships won’t happen at work. The problems can occur when preferential treatment becomes an issue, or when a person in a position of high responsibility can be blackmailed, or when one party pressures or takes advantage of a person not in a position of power. It is a good question to ask and it should not be answered from a puritanical perspective but from a pragmatic and realistic one.
McDonald’s has a clear company policy about dating co-workers and Mr. Easterbrook broke it. He clearly knew what he was doing and had to accept the consequences.
Corporate policies around rules of conduct must be followed regardless of an individual’s position in an organization. Any corporation that lets an employee “slide around policy” and looks the other way sets themselves up for more employee issues and lawsuits. I understand the relationship was consensual, but he was CEO. This means all employees of the company ultimately report to him including his consensual partner. In the end I feel Mr. Easterbrook and the Board made the right decision to part ways.
Forty years ago, I became involved in a consensual relationship with my boss. Few people knew until we got engaged, and we’re still married, now with kids and grandkids. I sometimes kid her that she’s still my boss. We’re glad neither of us was fired! Come on, lighten up! Love happens when and where it happens.
Congratulations!
I hate corporate policies on principle – there’s still some ’60s rebellion left in me. But if the policy is no nookie and you get caught, shame on you. And to Nikki, with whom I usually agree – it doesn’t matter what degree of separation there is, if he can say “You know, she’s not doing so hot,” her career might be toast.
What, exactly, is the company policy about consensual relationships? As Nikki points out, trying to snuff out relationships between employees entirely is not an achievable or fair outcome. (Speaking as somebody whose wife of 37 years worked for the same department store company, although in different operating divisions.) But relationships where one partner has the power over another’s career should clearly be avoided.
If this is the aim of McDonald’s policy, it makes sense — and since the CEO has the power over everybody else’s career, the decision to let Mr. Easterbrook go was the right call.
Assuming that the relationship was totally consensual, I think this is a study in failed leadership. Whether McDonald’s should have a rule against employee relationships or not, the fact is they do. And, as CEO, Easterbrook had an obligation to play by the rules he (presumably) expected the rest of the organization to play by. If he thought the rule was stupid or draconian, he should have changed it. Absent that change, or even an attempt to make that change, he is bound to enforce it — even on himself. Leaders aren’t like everyone else, they take on a higher ethical burden along with the big salaries and perks of their position. Again, assuming Easterbrook’s relationship was totally consensual and there was no pressure on his partner, the truth is those conditions may not apply to a store manager seeking coercive sex from his or her subordinates and using Easterbrook’s example to justify her or his behavior. When anyone thinks they operate above the rules, it’s past time to make sure they aren’t in a position to enforce them on everyone else.
This isn’t even a close call. Of course there should be rules about personal relationships in the work place and of course they should be enforced. Work environments are tough enough without personal relationships making things even messier. The first hint that the environment isn’t honest and fair, ruled by integrity, and offering equal opportunities, will create very unwelcome distractions. Office politics are wicked enough when there is no romance involved.
It is fascinating what a high profile impact this has made in the news. Why does it have such a high profile? Is it because McDonald’s are unusual in their approach with regard to rules? Or could it be that they are unusual in actually enforcing the rules that they lay down?
The reality is that, irrespective of industry, many of us are aware of such relationships existing at someplace or other, at some time or other with little or no consequences – despite any rules, guidelines or code of conduct being in place.
If there is no conflict of interest, then a consensual relationship should not be prohibited.
Yes, and those conflicts of interest should be pretty easy to define: Do the two partners work in the same division of the company, or in different areas like marketing and finance? And, especially, does one partner have reporting responsibility to the other, even if indirect? Those ought to be the standards, not just a blanket denial of what seems inevitable in many workplaces.
Ah … Dick … but what happens when roles change? Let me the Devil’s Advocate for a moment. Consider this hypothetical. Ms. A, a vice president of HR, engages in a consensual relationship with Mr. B, a vice president of operations. They are in some meetings together, but their worlds are generally separate. One day Ms. A is promoted to Senior Vice President of Operations, becoming Mr. B’s direct boss. The issues you raised — do they work in the same division, or does one report to the other — weren’t in play when they began the relationship, but suddenly both conditions have been met. What should they do? Stop the relationship? Decide which one leaves the company or transfers out of their current position? Or, just maintain their personal status quo? I am NOT arguing in favor of a “no relationship” policy, just pointing out how fast things can get sticky when one exists. That said, though, I still stick to my original position that the CEO operates at a higher standard of responsibility and accountability, and, if an antiquated rule is in place, she or he has only two options — change it or live with it.
At the leadership level, you often lead by example. Rules/policies are meant for everyone. Leadership can’t act one way and expect employees to act another. As for what happened at McDonald’s, it is a shame. We may not have all the details. Was it just bad judgement? If so, at that level there shouldn’t be bad judgement. Leaders are expected to guide and be role models. Do I agree with this type of rule? There are some guidelines to consider, but office/company romances are not uncommon and are often accepted in organizations without any issues. McDonald’s – and other organizations with similar policies – may want to take a close look at their policies and rules and understand just how they impact the company long-term.
Quite the juicy topic for a Monday morning! There are lots of angles to take on this.
First, the top executive should follow the policies, or else what do you expect everyone else to do? So given the policy, it’s the right thing for McDonald’s to do.
Second, it’s slippery slope when the “boss” is involved in one of these relationships. It’s pretty easy to take the “predator” view of this — however, let’s get the facts first, folks, before we even open that door.
Third, and maybe most importantly, these policies are somewhat ridiculous. Lock people in the same room for 40-plus hours every week and love will show up at some point for some in the room. Accepting the reality of being human should be the starting point, and then build some common sense policies around this to ensure everyone is on board in the right direction.
(It’s a good thing I work with my wife because I’m pretty sure I just flirted with her!)
No business should set such a strict rule regarding relationships between co=workers. When single people spend eight to 10 hours a day working together, relationships are likely to occur. However, an executive who takes advantage of a subordinate is not to be tolerated and this should be a policy in all companies. HR professionals can find the right set of regulations to govern OK relationships and those that are not permitted. Open and acknowledged relationships between co-workers should be allowed by policy and I believe HR professionals have dealt with this in many companies and public companies. Mr. Easterbrook violated a company policy and I am sure many McDonald’s part-time employees have also violated the strict policy, but they are not the CEO!
It’s not possible to exert complete control over all activities of people in a working environment. Consensual relationships will always exist, no matter the consequences. Still, having rules and consequences outlined is necessary, for legal and practical reasons. When poor judgment happens at high levels, examples must be made.
Personal freedoms away from the workplace are not within the boundaries of workplace rules. Who a person is in their private life should not hinge on their position or where they work. McDonald’s should wake up to the 21st century and realize that we are people first and not workers of a company beholden to corporate rules in our private lives. Our constitution guarantees many freedoms and America was founded on these freedoms. This doesn’t give a corporation the right to impinge on these with a corporate policy. Dictating personal freedoms, by a company, is just wrong.
When I worked for a major oil company the rule governing personal relationships was that you could not engage in one with someone who reported to you directly or indirectly or for whom you had any influence over their career. I remember the head of operations coming to me and informing me that he and someone in the marketing department were dating. The organizational structure meant he had no influence or control over her position nor was he ever likely to. They got married and are still married.
The difference is Mr. Easterbrook was the CEO and as such he had the ability to influence the individual’s career. Even in a consensual relationship he violated the rules and McDonald’s had no choice but to take action.
Steve, you raise a very interesting point. What happens — in a company like McDonald’s — when two employees get married? Is marriage O.K., but a consensual relationship wrong? If Easterbrook had married whomever it was he was allegedly in a relationship with, and she or he had remained employed at McDonald’s, would it have still been a violation? And would he have had to leave anyway because a relationship presumably precedes a marriage?
Again, I totally agree with your point that the CEO is in position to potential coerce any and all employees, and that under the current rules, he had to go, but it would be interesting to know — which I don’t — McDonald’s policy on employees who are married to each other.
Earlier in this thread Kai worried about personal freedom. Nothing sounds less “free” than forced marriage so, if the policy allows employees to remain on the job after they marry each other, but not if they are just having a relationship, the policy really should be up for review.
The Times article noted that “McDonald’s recently began offering new online and in-person training programs to its employees in the U.S. in an effort to combat workplace sexual harassment. But that step has not satisfied the company’s critics.” I think that today all companies should consider this kind of policy addition to their current policy mandates. This policy should be well understood by all parties in the company, and make all concerned in the violations subject to review. Over-all, this is a terrible problem.
A relationship can never be 100 percent consensual if there is a power/authority difference. I suspect that McDonald’s put this out there – that the relationship was consensual – to protect the CEO’s reputation. But who’s to say the person he was involved with won’t come back with a lawsuit? This is why McDonald’s policy can’t have any gray areas.
Totally agree about the unacceptability of a gray area. The issue really is power, and in most organizations a CEO has myriad potential ways of directly and/or indirectly coercing all of her or his employees.
When there is a difference in power, the word consensual has multiple meanings.
Some say the world has changed. First there was the feminist movement now that we have the MeToo generation. Proper manners never change and as I was told in my early corporate life, don’t mess in the kitty box. Companies have rules for a reason including no dating the opposite sex and no relative hiring. Both can cloud or change decision not for the benefit of the company. Yes, he should have been fired just as anyone working for him would have been. There are not different rules for leader and workers.
The policy is not about the individual it is about the company and the company’s employees. Relationships, consensual or not, in the work area cause a very large number of problems that directly affect the general population in a negative way. Not just the monetary erosion, but the evidence that highly desirable employees feel compelled to leave for their own perception of company employee conduct is not to be ignored.
When individually minded employees feel compelled to position themselves in opposition to any or all of the corporate policies in place, the correct approach would to submit for a change in policy(s) in writing with supportive evidence and/or argument. The individual(s) that take it upon themselves to arbitrarily circumvent the system at will is positioning the livelihood potential of all employees without their awareness or approval. He should have been bounced with prejudice just like he behaved towards the company and fellow employees.
While I can understand the logic of this principle, as the question is currently stated it seems overly broad: if two 18-year old servers fall in love, what is a company going to do about it?
(On a personal note: my parents met at work, so I could argue I have or would have had a prenatal, personal interest in opposing this!)
I agree with Nikki. It is not that employees should not have consensual relationships. It is about avoiding situations where there is potential for abuse of power. That is the very definition of sexual harassment. Does a person who works for you genuinely have the ability to consent? Do leaders need to be held to a higher standard? You can not stop two people who work together from forming a potentially romantic relationship. You can however, expect leaders to not put their direct employees in a compromising situation.
With great leadership and power comes great responsibility. It was not very responsible of Mr. Easterbrook to allow that to happen for a great many reasons. He could have made many other choices that would not have compromised him or the company.
There is a strong dichotomy that exists in this situation i.e. proximity versus policy. When people spend an inordinate amount of time with each other, relationships can and do develop. With that being said, a CEO should fully understand their own fraternization policy and the massive ramifications that exist. It appears that many individuals in a position of power forget that the rules apply to them as well.
I have witnessed this type of scenario play out numerous times during my 30-year tenure within the retail sector. Moreover, leaders would usually attempt to “hide their relationship” thinking they could get away with it. In all of the retailers that I worked for, salaried leaders must disclose any and all romantic entanglements to management “in advance.” This would afford the human resource leaders time to evaluate the best strategy for all parties involved i.e. relocation to a different store, position, or company.
It is unfortunate that he chose this type of behavior which will probably overshadow and devalue all of the positive enhancements he implemented.
There are too many unknowns to make any real judgment in the case of Steve Easterbrook. It’s interesting that the Chief People Officer left as well, but again not enough information provided. Did he know of the relationship (which I would expect)? Or perhaps he left because he didn’t feel it was fair. We simply don’t know at this point.
To put out a blanket statement that prohibits personal relationships between co-workers is archaic. There are plenty of people that enter into romantic relationships at work including married people working at the same company. The majority of businesses have a hard-fast rule about direct reports and managers not being involved romantically for obvious reasons. All rules should be reviewed for relevance and adjusted accordingly when needed.