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From company culture to drug culture: How did it all go so wrong at WeWork?
According to an investigation by Business Insider, WeWork paid off a female employee with a cash payment in excess of US$2million for her to remain quiet after she threatened to expose an alleged culture of drug-taking, bosses sleeping with employees and discrimination at the company.
In the 50-page document filed about WeWork by a whistleblower – that outlines a catalogue of allegations – she also claimed that she was a victim of sexual assault.
The whistleblower also alleged in the document that there was widespread use of MDMA, cocaine, and the prescription medication, Xanax, at some company events and outlined problematic sexual relations in her department that didn’t not follow generally accepted HR practices on relationships in the workplace.
The employee who blew the whistle worked under Mark Lapidus, the cousin of the wife company founder and former CEO Adam Neumann (pictured below). Lapidus has since been fired from the company.
The whistleblower, who has not been named, due to an unverified claim of sexual assault, outlined a multitude of allegations and threatened to sue the company and an unnamed colleague at WeWork – in addition to filing a charge of discrimination with the Equal Employment Opportunity Commission.
The employee who was allegedly paid off to keep quiet, received the money around the time Neumann was in talks to raise more capital for WeWork with Japanese conglomerate SoftBank – when bad publicity would have damaged the New York-based co-working company’s reputation.
To be fair, WeWork launched its own investigation with an independent law firm, finding credible claims of bosses sleeping with subordinates and illicit drug use.
WeWork is now endeavouring to get its workplace relations and reputation back on track. It has secured the services of Sandeep Mathrani, who has just taken over as CEO of the prime office space provider.
“At WeWork, the new executive leadership has zero tolerance for (poor workplace) behaviour or any violation of our company policies,” Mathrani said in a statement to Business Insider.
“It is our highest priority to ensure our employees feel safe and respected, and this starts at the top. In this new chapter at WeWork we are fully invested in upholding a culture of integrity,” he added.