He's being a pathetic loser. Talk to him and tell him to clean up his act (if you really care about him that much) and see what he says. He should be begging for forgiveness at this moment if he really cares about you! At the end of the day, your the winner because you have moven out of a relationship that never had a future, if he cheated now then he would have cheated in the future too.
As for that girl, she is " #1 "insecure about herself so she is using a sexual relationship with her boss to keep herself feeling secured finacially, physically and mentally.
or "#2" she has feelings for him and maybe believes that sleeping with him will make him have teh same feelings for her.