Actually, I would not be surprised if the "leak" is a trial balloon. Float a possible one year suspension, see what the public (and player) reaction is and adjust accordingly.
As someone who practices labor and employment law, an undisclosed physical relationship with a subordinate employee is a real problem. Exposure exists both with to involved employee in the event the relationship (physical or employment) sours, and to co-workers. As others have explained, if you create an environment where sleeping with the "boss" is perceived as the way to get ahead, you have substantial exposure to your other (especially female) employees. I have been involved in both kinds of claims, these are not just hypotheticals. As an organization, these are reasons you discipline/terminate the leader. Another reason is the incredibly poor judgment the behavior reflects. That being said, the approach an organization adopts always takes into account the senior employee's value to the organization.
As is true in all workplaces, the dynamic with the players is a real and relevant consideration, particularly if they know the staffer and have witnessed interactions between the two. I have been involved in situations where the folks in closest proximity to the situation saw the lower level employee as an active participant or the pursuer in the relationship, and felt a popular, effective leader was being unfairly punished for a personal indiscretion.
Long way of saying, these situations are a mess for employers. You are always choosing among least bad options.