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Fired Netflix employee alleges tax avoidance “façade” in India and more

The former employee alleged that she was discouraged from making complaints about a tax memo, and accused her immediate supervisor of sexist remarks. 

Nandini Mehta, an Indian lawyer who worked for Netflix between April 2018 and April 2020, alleged on Tuesday that the company was leveraging corporate structures to avoid tax liabilities in India. In a wrongful termination lawsuit against the company filed at the Superior Court of California, Mehta alleged that she “was advised by members of Netflix’s United States tax team that Netflix did not want to expose itself to tax liability in India,” and that a memo circulated in the company “created a façade that required its employees (mostly Indian) working in India to create the superficial and illusory appearance that Netflix was not “permanently established” in India.”

Mehta said that employees in India would have to package decisions as recommendations to US-based employees, who would officially clear decisions. MediaNama has viewed a copy of the complaint, first reported by Law360.

Netflix denied the allegations in the suit, and said that the corporate structures it had in India were standard among multinationals here:

Ms. Mehta was fired from Netflix for repeatedly using her corporate credit card for tens of thousands of dollars in personal expenses, including nearly $9,000 spent at Cartier. These unauthorized charges occurred over a significant period of time. Mehta was instructed not to use her corporate card for personal expenses and given ample opportunity to correct her behavior. She did not and her employment was terminated as a result.

The accusations Mehta has made about our corporate structure in India are categorically untrue. The structure we established in India is typical for multinational companies and reflects our business needs and the relevant governmental rules.

We are confident her claims will be found to be totally lacking in merit. — Netflix spokesperson

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Allegations of xenophobia and toxic work culture

Mehta in her complaint painted a picture of a company where her gender and nationality were allegedly frequently used to discriminate against her. She alleged, among other things, that:

  • Her immediate supervisor made multiple derogatory comments about Indian women, Mehta, and Indian-American employees at Netflix, both in the US and in India, and referred to India as a “shithole”. She alleged that this supervisor felt threatened by her work record and that he disparaged her for overstepping her bounds, calling her “greedy” and offensive epithets.
  • The supervisor would refer to an India-based policy executive in sexist and debasing terms for flagging potential grievance issues with content that was going to release in India. He allegedly accused top content executives in India and the US of “blowing up” the company’s India slate.
  • He warned Mehta that complaints about the tax memo among other things were endangering her job and signalled to colleagues that he was recruiting a replacement; he also allegedly blocked at least one Indian woman’s appointment suggested by Mehta.
  • The company had an internal travel memo that warned American executives to prepare for the following when in India: bouts of diarrhea, taking “your own needles” when going to a hospital, training home staff in “basic personal hygiene”, and “Don’t make jokes about cows.”
  • She was being paid less than male colleagues in her team who had less relevant experience in the field than she did.
  • She was discouraged from making HR complaints on pay gaps and was ultimately given a raise after which her salary was still less than that of male colleagues.
  • Mehta was compelled to move to India, and she was demoted in 2019, in an email that also went out to her subordinates. She alleges that her access to her salary was limited, and due to Netflix’s hesitancy to add her to the US payroll, two-thirds of her annual income was being taxed in both India and the US.

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