There may be irony in Olympus Corp.’s recent announcement, but about 3,000 workers may not see it. The company announced earlier this month that they have reached a multimillion dollar settlement with the former chief executive officer; soon after that came the announcement that Olympus will be eliminating almost 3,000 jobs. The executive claimed he lost his job in retaliation for blowing the whistle on the company’s illegal accounting practices.
The board of directors approved the $15.4 million settlement following months of negotiation. Olympus has admitted to hiding $1.5 billion in investment losses incurred over the past 20 years.
Along with the unlawful dismissal, the executive claimed the company discriminated against him. He alleged the Tokyo-based company treated a Japanese executive differently.
Business analysts say the company’s image has suffered not from the accounting issues but from its management of the whistle-blowing case. And more damage could be around the corner as the company resolves yet another whistle-blowing case on a different, non-accounting matter.
Olympus chose to manage its own investigation into the accounting charges. The result stunned some in the business community: The company turned over three former executives, including the former chairman of the board, to law enforcement authorities. Several executives also face civil suits as the company looks for damage awards.
These and other problems seriously affected the company’s bottom line. Olympus posted a $620 million loss for fiscal year 2012. Along with the job cuts — roughly 7 percent of its workforce — the company will close a dozen manufacturing facilities over the next two years.
With the announcement of the settlement, the executive involved released a statement praising the company’s products and wishing Olympus success with its new management team.
Alan Olson practices employment law throughout the United States from his offices in New Berlin, Wisconsin. Attorney Olson may be contacted at [email protected] with questions about the information posted here.
Source: Daily Reporter, “Olympus whistleblower wins millions over unlawful dismissal; company cutting 3,000 jobs,” Yuri Kageyama, June 8, 2012