In the last week of November, Ronni Zehavi, the CEO and co-founder of the Israeli startup Hibob, was part of a panel on startup HR issues at a Herzilya meet-up and discussed the results of a survey his company had taken of chief executives.
“When we ask what keeps CEOs awake at night, they would answer ‘people,’” he said. “Board meetings today start not just with updates on where company revenues are coming from but with a deep analysis of their employees: Who do we have? What’s happening to them? Are we retaining them?”
It would have been good if the speakers had noted the date – the International Day for the Elimination of Violence against Women – and devoted time to how growing startups deal with sexual harassment complaints. Some of the questions could have been asked of Zehavi himself.
According to an investigation by TheMarker in recent months, four former female Hibob employees are alleging they were the victims of sexual harassment by the company’s chief revenue officer, M. All four said they were subject to verbal harassment by M. and two said they were touched improperly – one woman said that in one instance M. put his hand on her crotch.
M., 48, is an Israeli and one of four C-level executives at Hibob. According to the complainants, all the alleged incidents occurred during the workday at the company’s offices.
Hibob, which employs 170 people in Tel Aviv, London and New York, develops software for human resources management. Counting some 600 corporate customers, the company was formed in 2015 and has raised $55 million from top-tier investors such as Bessemer Venture Partners, Eight Roads Ventures and Battery Ventures. Hibob’s last fundraising round in July was done at a $120 million valuation.
The women have not filed complaints with the police because they believed that the best way to handle the problem is within the company so as not to harm their career prospects in Israel’s closely knit high-tech industry.
Zehavi, 53, is a well-known figure on the local tech scene and previously founded startups including Cotendo, which was acquired by Akamai Technologies in 2012 for $300 million. Afterward he became a partner at the cybersecurity investment fund Team8 and an entrepreneur in residence at Bessemer.
Still on the job
M. remains in his job at Hibob while the women were told, explicitly or implicitly, that they had to learn to work with him if they want to remain in the company. The particulars of the accusations are not being published in TheMarker for reasons of privacy. The complaints were cross-checked with several other employees and outsiders who witnessed the incidents. The allegations are also supported by internal correspondence and polygraph tests.
According to the sources, Zehavi was notified about at least three of the complaints, but in connection with two of them, he did not act to prevent the alleged harassment in the company as required by law. In the third, the complainant, identified as A., contacted the executive responsible for harassment issues and demanded that the company’s attorney become involved and the board informed.
In that case, the company said it could not draw a definitive conclusion about the complaint, saying it was a case of M.’s word against the woman’s. However, it did notify M. that in his dealings with female employees “there is conduct on your part that conveys something that may cause discomfort to the other party, and especially a style of speech inappropriate to the workplace,” according to a letter summarizing a meeting with him.
In an incident where M. and A., a junior employee, were standing on line for the bathroom, M. admitted to TheMarker that he asked her jokingly if she wanted a “golden shower,” a reference to a sex act. A. also reported on another problematic incident. The board discussed A.’s complaint, but it is believed that the board was told that the complaint was withdrawn and the employee announced she would be leaving the company on her own initiative. She was awarded a payment equal to three months’ salary, an unusual termination agreement for a junior employee.
Hibob’s initial response to queries by TheMarker was a blanket denial. Later it hinted that the complainants had ulterior motives. Finally, TheMarker was informed that after an internal investigation in response to the queries, management learned that an anonymous employee in one of Hibob’s overseas offices reported feeling uneasy at the way M. had looked at her.
But, because the complaint was made anonymously, there was no way to handle it. The company said that in retrospect perhaps the complaint should have been handed to the executive responsible for preventing harassment in the company.
Hibob’s response is surprising given that in the case of A. six months ago, M. was explicitly told in writing to avoid looking at employees in a sexual or otherwise inappropriate manner, exactly in the way the anonymous complainant alleged he had done to her.
M. asked TheMarker to conduct a polygraph test. The newspaper agreed that he'd bring with him an experienced polygraph tester of its own, an ex-Mossad officer, to supervise the test - that includes the early conversation, drafting the questions and decoding the results. Both experts concluded that M. had lied to all the relevant questions asked. The questions related to touching one worker’s crotch, to inappropriate remarks said to another, and to M.’s conversations with Zehavi regarding other incidents besides A.’s complaint.
Zehavi denies that he had held conversations with M. about complaints other than A.’s and that he knew about the existence of these complaints.
The behavior of M., an employee at Hibob for the past three years, was known to other employees both in Israel and abroad. Some described it as common among salespeople who often use aggressive and rude language with each other.
The complainants, however, called M.’s talk an act of domination and bullying through blunt and degrading statements that undermined their sense of professionalism and self-confidence.
“You arrive for another day of work and give all of yourself professionally and expect that work-related communication will be of that kind, as well,” said one of the four women. “But someone allows himself to enter your personal space and talk to you insultingly, and you don’t know where you stand, what it all has to do with, and why I need to put up with it. This is a man who’s aware of his power – he feels he’s invulnerable and exploits gender differences to his benefit. I got up in the morning feeling nauseated, not wanting to go to work, when I knew he was there.”
No corporate HR function
A former Hibob employee who worked in the company’s U.S. offices told TheMarker: “Working at Hibob was the exact opposite of what to expect from a seemingly progressive [human resources] tech company. There was no corporate HR function, which allowed for a toxic environment to manifest. Working under the CRO was a heinous professional experience, and I would dread one-on-one meetings due to his completely unprofessional behavior and management style, which is unacceptable in any working environment, especially in the U.S., and I imagine the same for Israel.”
In response to TheMarker’s queries, Hibob responded: “The company and its management has a policy of zero tolerance for any conduct that could be considered sexual harassment or inappropriate behavior, and there are even employee-training workshops on these issues ....
“Company managers have received one complaint about the alleged inappropriate behavior of an employee – the one who is the subject of [TheMarker’s] reporting – toward an employee.”
As the company put it, “Upon receipt of the complaint, the company began a comprehensive and thorough investigation of the allegations without delay via the person responsible for preventing sexual harassment and accompanied by a specialist lawyer. After a comprehensive inquiry and after the employee denied the conduct attributed to him, the company could not verify with certainty as to the facts described in the complaint.”
It added: “Nevertheless, the management chose to undertake strict disciplinary measures against the employee, hold talks to refine the procedures with all the directors and managers of the company, and update the board of directors about the complaint. The [complainant] was notified of the investigation’s result and expressed her satisfaction with the handling of her case. Her departure from the company several months later was unrelated to her complaint, with her severance terms in line with a common agreement that does not go beyond other retirement agreements in the company, contrary to what the article claims.”
Hibob concluded: “The employee against whom the complaint was filed last November announced that he will be leaving the company in 2020,” Hibob said.
M. said in response: “I have respected and continue to respect women over the more than 20 years I have been in management positions. My actions are not those described in the article and I strongly oppose such behavior.”
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