1st December 2022

CVS Well being Corp. CVS -0.59% Chief Govt Karen Lynch has eliminated a number of executives following an inside investigation into how they dealt with sexual-harassment complaints and is overhauling how the corporate handles such issues, based on folks accustomed to the matter.

Ms. Lynch, who took over as CEO a yr in the past, in December turned conscious of complaints made by a minimum of two feminine workers alleging {that a} New Jersey-based regional retailer supervisor had both harassed or inappropriately touched them at work, the folks stated.

Ms. Lynch oversaw an investigation, carried out by an expert investigator, that culminated in January within the dismissal of the supervisor, who oversaw lots of of shops, and the departure of senior executives who supervised him, these folks stated. The probe and management exits haven’t beforehand been disclosed.

On Friday, she outlined the occasions to some 450 senior leaders on a name, and laid out plans to create an workplace designed to offer workers a confidential channel to navigate what Ms. Lynch described as difficult conditions, among the folks stated.

In a memo despatched to workers later Friday, Ms. Lynch stated the allegations have been substantiated, and she or he instantly terminated the regional supervisor. “Our investigation additionally revealed that different workers failed of their obligation to deal with such allegations with the seriousness we anticipate, and they’re not with the corporate,” she wrote.

One government who supervised the regional supervisor and a human-resources government have been dismissed, whereas a 3rd government left the corporate throughout the investigation, the folks stated. The regional supervisor and the third government declined to remark. The opposite two people had no fast remark.

CVS operates 9,900 drugstores.

Picture: GABBY JONES for The Wall Road Journal

“I wish to be crystal clear: this firm doesn’t tolerate harassment or hostile, abusive or discriminatory behaviors of any form from any worker —no matter place,” she wrote within the memo. “We additionally won’t tolerate inaction from leaders who’re chargeable for escalating considerations or allegations raised by our colleagues.”

In her memo, Ms. Lynch stated the corporate would enhance its inside reporting and investigation processes, and had created a confidential channel for workers to lift such considerations to senior leaders. She is reviewing procedures within the firm’s human-resources and authorized departments in addition to an arbitration program for workers.

CVS, which operates 9,900 drugstores and the Aetna insurance coverage enterprise, has about 300,000 workers. The corporate and its rival Walgreens Boots Alliance Inc. have struggled at instances to maintain up with demand for Covid-19 vaccines and testing amid a decent labor market. Tough working situations at shops have led to worker backlash and prompted each firms to at instances shorten retailer hours and typically shut on weekends.

Ms. Lynch, an insurance-industry veteran, presided over Aetna following its acquisition by CVS in 2018. She took over in February 2021, making CVS the biggest firm by income to be run by a feminine CEO.

Write to Sharon Terlep at sharon.terlep@wsj.com and Suzanne Kapner at Suzanne.Kapner@wsj.com

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Appeared within the March 12, 2022, print version as ‘CVS Ousts Executives After Probe.’

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