Culture | WeWork hit by £1.5m payoff claims after drug allegations

WeWork hit by £1.5m payoff claims after drug allegations

Corporate culture is important to any business, not just because it helps employees enjoy their working experience more, but it also helps with employer branding and attracting new talent to the business too.

However, real estate firm WeWork has hit headlines after a whistleblower claimed that she was silenced by a £1.5million (two million dollars) cash payment after she threatened to expose an alleged negative culture at the company – one that reportedly included intimate colleague relationships, drugs and discrimination.

The Daily Mail reported that in 2018, the anonymous woman sent a 50-page document to WeWork outlining the various allegations including the claim that she was the victim of a sexual assault.

In addition, the person claimed in the document that there was a prevalence of cocaine, MDMA and Xanax possession at corporate events by the real estate team, whilst also claiming that a senior manager admitted he had slept “with two direct female subordinates”.

The employee, who worked under Mark Lapidus (the cousin of Co-Founder Adam Neumann's wife) wasn’t explicitly named in the document yet it was reported that many of the allegations took place in the real estate department that he oversaw. In 2017, it was reported that Lapidus spent huge sums of money on lavish nights out in London and Las Vegas. It was reported that he was later sacked at a similar time to the woman's pay off.

The Daily Beast claimed the release of this report at the time it was filed would have destroyed the firm’s mounting business success, given that the firm’s CEO (who was Adam Neumann at the time) was in fundraising talks with SoftBank. It was reported that the whistleblower was allegedly paid off at a similar time.

An independent law firm was brought in by WeWork to investigate, revealing credible claims of drug use and bosses sleeping with their direct reports.

While Neumann’s spokesperson declined to respond to Business Insider’s request for comment, Sandeep Mathrani, who has recently taken over the reins as CEO of WeWork, pledged to adopt a ‘zero-tolerance approach’ to behaviour that violated company policies going forwards.

He said: "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," Mathrani added.

But this isn’t the first time that the real estate firm has hit headlines over its alleged poor culture.

WeWork staff share fears over future employability

A portion of WeWork employees previously shared concerns that their tenure at the real estate firm would act as a “black mark” on their CV and would discourage prospective employers from hiring them.

In previous times, listing work experience at WeWork may have been considered a CV highlight – yet since the CEO and Co-Founder, Neumann was ousted from the firm as the firm grappled with revamping its image – some staff have admitted fears that their association with the company could actually hinder them in future.

But it seems that similar concerns were echoed at companies such as Uber and Lloyd’s of London who have received hefty press coverage over alleged toxic cultures.

The importance of company culture

Cultivating a good company culture that allows employees to thrive and business to prosper is crucial for any organisation. What can take a lot of time to successfully build can be tarnished in a matter of seconds.

Below, HR Grapevine has collated two tips for building a positive company culture.

Authenticity

Creating and developing an authentic company culture is the first step. Stuart Branch, Group People Director at Weetabix previously told HR Grapevine that each business will develop a corporate culture, “whether it is deliberate or not”.

He added: “It’s simply the collective view of ‘what it’s like to work here’.” Therefore, setting out a clear vision and goals from the beginning is something that all employees can get behind.

Tailor your approach

While there is no one-size-fits-all solution to outstanding leadership, there are different ways to get the best out of teams at work. Ronald Meijers, Human Capital Partner at Deloitte, previously told HR Grapevine that managers should be “responsive and flexible enough to be able to discard any behaviours that aren’t working – and find some new ones that do.”

He explained that by putting themselves in new contexts, managers will be better equipped to face unexpected challenges going forwards. “Effective delegation is an important trait, of course; yet great managers are also prepared to get stuck in with day-to-day tasks so they can get to know the experience of their employees inside out,” he explained.



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