The lawsuit, filed in the Supreme Court in the state of New York this week by Ian Jack Miller, has named Zara, Dilip Patel, and Moises Costas Rodriguez as defendants.
Mr Miller worked as the company's General Counsel from January 2008 till March, serving as Zara's only in-house attorney throughout the US and Canada.
Mr Patel is the Country Manager for Zara USA and works at its Manhattan office while Rodriguez is the former CEO for Zara USA and the current Director of Expansion for North and South America.
The lawsuit said Mr Miller is suing Zara for "hostile work environment, pay discrimination, and unlawful discharge based on his religion, national origin, and sexual orientation" and seeking damages in an amount in excess of US $40 million.
The lawsuit alleged that Zara's senior executives, including several close confidants of Zara's founder Amancio Ortega, treated Miller's ethnic and sexual orientation "as a strike against" him.
The lawsuit said several of the individuals who were primarily responsible for discriminating against or harassing included Patel and were installed personally by Ortega.
It added said Ortega's "friend Patel "was responsible for much of the hostile work environment, pay discrimination, retaliation and unlawful termination that Miller experienced".
It alleged that Patel had strong links with Ortega and as a "result of this personal connection, he engaged in discriminatory and harassing conduct with impunity.
"Supervisors and colleagues sent Miller homophobic emails, made anti-Semitic remarks in his presence, and boasted that Spanish employees enjoyed more job security than employees of other nationalities," the lawsuit said.
"Zara also gave Miller lower raises than employees who did not share his protected characteristics, even though Miller was a strong performer, the Company's revenues were growing, and other Zara employees who fit the Company's preferred profile received higher raises," it added.
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