The Employee Engagement Network

The Continuing Saga of Dov Charney and his Underpants: A Story of Leadership Lost

Changing Winds

Last July I wrote a post about American Apparel founder Dov Charney’s problems. I was intrigued by how a young Montreal college student created a highly successful clothing company, only to watch it begin to disintegrateyears later as a result of his odd behavior.

Since my post American Apparel has been in and out of the news. Recently, Charney and his company were hit with a $260 million law suit for nonconsensual sex, filed by a former female employee who describes a lurid case of abuse of power. At the time Irene Morales (now 20) was just turning 18. In her suit, Morales says the demand for sexual favors went on for eight months.

Within a few days of the lawsuit being made public, a judge on March 10 ordered a temporary halt to the case, based on Charney’s lawyer’s claim that Morales had earlier signed legal papers stating that any issues she had with the company would be dealt with privately. The judge now has to decide whether the case can be heard in court.

This is bizarre – that a teenager had allegedly signed legal documents aimed at protecting American Apparel should any dispute arise in the future. This is tantamount to carte blanche for Charney, an open licence to do as he pleases with his employees.

As I said in my July 5, 2010, post:
“…when the boss inserts his own work style and sexual preferences into the workplace all hell will eventually break loose. And that’s what’s happening at American Apparel. Industry observers have begun a death watch of the company, with the latest news being its deteriorating financial performance.

This is a shame. American Apparel’s imminent demise shouldn’t be happening, but it is because of what I’ve briefly described above. When a company’s purpose (read mission) is derailed and its vision is diluted because of its CEO’s behavior (in this case also its founder), and in the context of a highly competitive, cost-driven and volatile industry, it’s virtually impossible for a firm to remain viable in the long-term, let alone medium-term.”

Have the wily Charney and his company run out of time?

Stay tuned for further developments in this very sad story of a once innovative company.

You do not merely want to be considered just the best of the best. You want to be considered the only ones who do what you do.
- Jerry Garcia, Grateful Dead

Click here to read my new White Paper on Management, Innovation and...

Be sure to visit my e-Books, Resources and Services pages.

Views: 41

Tags: American, Apparel, Charney, Corporate, Dov, Ethics, Leadership, Morals


You need to be a member of The Employee Engagement Network to add comments!

Join The Employee Engagement Network

580 Videos Related to Employee Engagement

Click on this eBook listing over 580 videos available on the network. When you open the document up online you can click on the title to go directly to the video. Happy and engaged viewing.

EEN Facebook Feed

The one question employee engagement survey: Why are you still here?

The one question employee engagement survey: Why are you still here?

The shortest Employee Engagement survey has one question | Leandro Herrero
And the question is: ‘Why are you still here?’ You learn about the organization by asking questions to employees when they leave you (exit interviews) but you learn far more when you ask them why they are staying (‘stay’ interviews). It’s not a joke. ‘Why are you still here?’ – with the emphasis on…

Open employee engagement with your key moment

Open employee engagement with your key moment

Open employee engagement with your key moment
What is the key moment at work that has the biggest impact on engagement for you and others? Is it the start of the day? The end of the day? How you begin a mobile meeting? Dealing with a conflict or work overload? Find the key moment and determine what you can do to prevent that moment from turning…

Employee Engagement Definition: A focus on “with others”

Employee Engagement Definition: A focus on “with others”

Employee Engagement Definition: A focus on "with others"
Employee engagement is not a solo endeavor (Reading time 42 seconds) I loved reading Kate Nasser’s deeper look at my employee engagement definition of: “good work, done well, with others, every day.” Thank you Kate. She offered an… [ 117 more words. ]

© 2014   Created by David Zinger.

Badges  |  Report an Issue  |  Terms of Service