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Friday, June 05, 2015

Zara Discrimination Lawsuit Paints an Ugly Picture of Its Corporate Culture

Zara Discrimination Lawsuit Paints an Ugly Picture of Its Corporate Culture:

A Zara shopper in Madrid. Photo: Dennis Doyle/Getty Images
A Zara shopper in Madrid. Photo: Dennis Doyle/Getty Images
Zara USA and several current and former Zara executives have been slapped with a discriminatory lawsuit seeking damages upwards of $40 million. The lawsuit, filed Wednesday in New York by Ian Jack Miller, Zara's former general counsel in the U.S., alleges that several of the Spanish fast fashion retailer's senior executives discriminated against him for being Jewish, American and gay.

The lawsuit points to Zara's public blunders in those areas — citing a handbag imprinted with Swastikas, a children's t-shirt resembling a concentration camp uniform and necklaces made of figurines in blackface, all of which Zara immediately pulled from its shelves — and alleges the company's internal culture is even worse, favoring employees who are "straight, Spanish and Christian."

During his time at the company from Jan. 2008 to Mar. 2015, Miller complains that he received homophobic emails, that anti-Semitic remarks were made in his presence and that Spanish employees were assured of more job security and received greater pay raises despite Miller's strong performance reviews and growing company profitability. In March of this year, Miller decided to seek legal counsel, which sent a letter to the company outlining Miller's claims of unlawful discrimination and the desire to come to an "amicable resolution." Miller was allegedly dismissed the next day, and on account of his dismissal — as well as Zara's close ties with other retail and real estate companies — has struggled to find work since.

A spokesperson for Zara USA issued a statement to Fashionista saying that Zara is a "diverse and multicultural company" with a "strong social commitment based on fairness, respect and equality for all." The spokesperson added that the allegations are "shocking" and that the company "will respond strongly and vigorously to these allegations in the Court."

The lawsuits claims are specific, lewd and no doubt embarrassing to many current and former employees. The lawsuit describes a corporate culture where visits to prostitutes are a normal part of business trips and a heterosexual lifestyle is endorsed. Miller says that former Zara USA CEO Moises Costas Rodriguez bragged about the size of his penis and having sexual relations with five female subordinates, including a director of human resources, and that he sent an email to Miller highlighting language that marriage is an institution "sanctified between a man and a woman." The suit claims that another Zara executive, Francesc Fernandez Claramunt, sent Miller's partner, Michael Mayberry, a pornographic image of an erect and tattooed penis and that Fernandez had been trying to persuade Miller to get such a tattoo.

But Miller appears to have felt most discriminated on account of his Jewishness. According to the filing, it wasn't until he had been working at the company for more than five years that senior executives learned of his religious identity. Before that time and after, the suit claims that senior executives had frequently derided the Jewish landlords and real estate developers they worked with, calling them "los judios" (Spanish for "the Jews") and complaining how difficult it was to work with "those people." Claramunt allegedly told Miller's Jewish paralegal that of course he was treated poorly by certain students at his university because "Jews are outsiders." After learning that Miller was Jewish —a disclosure that occurred around the same time that Miller dispensed some (apparently unpopular) advice on complying to New York labor laws — Zara executives began excluding him from important email chains and meetings, and cut his annual pay raises from upwards of 15 percent to just 3 percent.

What appears to be the most potentially damning to the company is the evidence of racial discrimination Miller has accumulated, not directed towards himself, but the Obamas. The filing claims there are "emails portraying Michelle Obama serving fried chicken and emails depicting Barack Obama in a Ku Klux Klan hood, with a Confederate flag, on a Cream of Wheat box, on an Aunt Jemima box and shining shoes." One need only look at the reaction to deposed Sony Pictures Entertainment chief Amy Pascal's racially-charged jokes about President Obama to see how such emails could damage Zara's public image in the U.S. and elsewhere.

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