The “sexy Santas” dancing in short skirts at a Seven West Media staff meeting were “incredibly embarrassing”, said an unnamed employee, while one of Australia’s largest media companies defended the performers as a Perth institution.

Nine newspaper’s revelation that four women wearing Santa hats performed high kicks outside Seven’s town hall in Western Australia on Friday came at an unfortunate time for the media company, as just weeks earlier the national broadcaster had accused the company of having a toxic work culture.

Responding to ABC Four Corners’ Don’t Speak report this month, Seven said it was “obviously concerned about allegations of poor conduct and any mistreatment of staff” and warned that “unacceptable behaviour will not be tolerated”.

Seven West Media Editor-in-Chief Anthony de Ceglie recently restructured the entire newsroom and his appointment of the Western Australian newspaper’s first female editor was seen as a step in the right direction.

But the announcement of Sarah-Jane Tasker’s promotion on Friday in media mogul Kerry Stokes’ Western Australian newspaper was overshadowed by media coverage of the dancers and attracted worldwide attention.

“I definitely raised my eyebrows and found it incredibly embarrassing,” one attendee, who did not want to give his name, told Guardian Australia. “I don’t know if I was necessarily offended, but it was embarrassing.”

Tasker told Guardian Australia the media reaction to the event was “completely over the top” because it was not a normal staff meeting but an “upfront-style presentation”, complete with fireworks and sizzle reels.

“I understand Nine’s focus, they clearly want to score points against Seven and will do so in any way possible,” Tasker said.

“But I take it personally because what these stories describe is not the workplace that I love and am proud to work in and that I now lead together with Chris Dore.”

Maryna Fewster, managing director of Seven West Media WA and host of the town hall meeting, praised Tasker’s “brilliant leadership performance” and highlighted her “groundbreaking promotion” to become the West’s first female executive.

The unnamed employee said the selection of dancers was all the more surprising because the event was hosted by a woman.

“I mean, technically the West is ruled by a woman, and she led the entire presentation session,” they said.

Seven said the dancers, who performed to Mariah Carey’s “All I Want for Christmas is You”, were part of the line-up of Perth’s annual Christmas Spectacular, which airs on Channel Seven on December 7.

Introducing Dore, who was the new editor-in-chief of the West Australian, Fewster said: “Dorey is the best editor in Australia.”

Following the Four Corners incident, the company said the actions of some individuals “do not reflect the values, behaviour and attitude of the wider organisation, which employs some of Australia’s best, hardest-working and most passionate media professionals”.

“Our focus is on building a stronger culture that enables our great employees to succeed and where unacceptable behavior is not tolerated,” a spokesman said.

After Seven West Media’s annual profit fell 69 percent to $45 million, CEO Jeff Howard admitted that it had been “a tough year” for the company.

Stokes’ media empire, which operates the Seven Network, a number of Western Australian newspapers and newcomer The Nightly, was also under scrutiny in the Bruce Lehrmann libel trial.

The court heard claims that the broadcaster refunded Spotlight interviewee Lehrmann money he allegedly spent on cocaine and sex workers. Seven and Lehrmann denied the claims.

In June, the company was restructured into three divisions: television, digital and western. More than 100 jobs were cut across the company and there was an exodus of top executives, including chief executive James Warburton, legal adviser Bruce McWilliam and long-serving news chief Craig McPherson.