Month: August 2021

About 1,000 jobs are at risk

US cyber security giant NortonLifeLock has announced that it is buying Czech rival Avast in a cash and stock deal, at a total value of more than $8 billion.

It is unclear what the new group will be called, but Avast and NortonLifeLock said in a joint press release that the merger will create a 'mega' IT security firm, devoted to protecting 500 million consumers from both companies.

The group will generate $3.5 billion in annual revenue.

The new company will be listed on the Nasdaq - as opposed to the London Stock Exchange, where Avast is currently listed - and operate through dual headquarters in Tempe, Arizona and Prague, Czech Republic.

The deal is expected to close in mid-2022, pending regulatory approval. Once it is complete, Avast CEO Ondrej Vlcek will become NortonLifeLock's new president and join the board, while Norton chief Vincent Pilette will serve as CEO of the expanded group.

The respective boards of directors of the two cyber security firms said they see the deal as an opportunity to 'create a new, industry-leading consumer Cyber Safety business, leveraging the established brands, technology and innovation of both groups to deliver substantial benefits to consumers, shareholders, and other stakeholders.'

The combined group hopes to tap a market of 5 billion internet users, while also focusing on creating products for small businesses.

UK-listed Avast has been offering both free and paid antivirus software for years, and has about 435 million 'freemium' subscribers. It offers a free, basic product to users and then tries to turn them into paying customers with more advanced software.

NortonLifeLock sells paid anti-identity theft and security products to consumers. The company was previously known as Symantec, before it sold its enterprise-security business to Broadcom in 2019.

According to Bloomberg, Pilette said in a call with reporters on Wednesday that about 1,000 jobs are at risk in the combined group, due to overlaps in responsibility.

"Combined, we have roughly a little bit less than 5,000 employees and we'll run the company moving forward at about 4,000," he said.

The job cuts will affect both firms and will be implemented across all geographies.

The Avast acquisition comes a few months after Norton bought German security firm Avira, for around $360 million in an all-cash deal.

Pilette said at the time that adding Avira would help NortonLifeLock to accelerate its overseas growth and "expand our go-to-market model with a leading freemium solution."

Amazon declares most of its revenues in low-tax Luxembourg - enough that, if all the sales were genuinely made there, it would have supplied about £78,000 worth of goods to each resident

Amazon reported up to £8.2bn of its UK sales in Luxembourg in 2019, to avoid paying the higher rates in the UK, a new analysis by trade union Unite has found.

The report, seen by The Independent, claims that Amazon declared £13.7 billion of UK sales in its US accounts in 2019, but reported just £5.5 billion in sales in filings for its UK-based firms.

The company declared €57 billion (£48.3 billion) of revenue in Luxembourg in 2019. That would mean it sold about £78,000 worth of goods and services to every person in the country.

The analysis, led by chartered accountant Vivek Kotecha, examined all of Amazon's publicly disclosed information to infer how much tax the company may be avoiding in the UK.

The researchers examined accounts for 19 of Amazon's UK-registered companies, including its warehouses, logistics operation and the Internet Movie Database (IMDb). They estimated that the retail firm paid a maximum of £84 million on its profits in UK tax - about £46 million less than would have been expected.

How does it work?

Amazon is able to shift revenues out of the country where they were actually made through its subsidiaries - an option not available to smaller firms. Unite argues that this gives large firms, especially those in the tech sector, an unfair advantage.

Amazon in particular uses its subsidiary Amazon EU Sarl, which is based in Luxembourg. Anyone buying from Amazon in the UK is actually billed by this subsidiary.

According to reports Amazon EU Sarl had just over 4,300 employees in 2019 and recorded revenues of €32.2 billion (£27.3 billion) - an average of €7.5 million (£6.4 million) per employee. That is about 36 times higher than staff at Amazon's subsidiares in the UK.

Unite has demanded a public inquiry into Amazon's tax arrangements.

Labour MP and Treasury Committee member Emma Hardy expressed concerns over the findings, and backed Unite's call for an investigation.

"I don't want a tax system that takes money from ordinary people to subsidise the growth of the world's biggest anti-union company," she said.

Atul K Shah, professor of finance at City University, said the findings provide a "long overdue A to Z of Amazon's UK tax avoidance".

In a statement to The Independent, Amazon rejected the report and said the discrepancy was because most of its sales to UK shoppers were booked by UK branches of one of its Luxembourg companies - although this simply confirms the report's findings.

The company said it had reported all the figures to HMRC.

"Our UK retail and Amazon Web Services revenues are recorded here in the UK and reported directly to HMRC," a spokesperson said.

"Our total tax contribution in the UK was £1.1 billion during 2019 - £293 million in direct taxes and £854 million in indirect taxes."

The spokesperson declined to disclose how much corporation tax the company paid on its UK sales in 2019.

Questions over Amazon's tax practices were also raised in May, after its corporate filings in Luxembourg showed that the company paid zero corporation tax in Europe last year, despite record sales income of around £38 billion.

Accounts for Amazon EU Sarl revealed that the Luxembourg unit made a €1.2 billion (£1 billion) loss and therefore paid no tax. Moreover, the unit was handed €56 million (£47 million) in tax credits to offset future tax bills.

Last month, Amazon was accused of profiting from price gouging at the height of the pandemic - while vulnerable people depended on home deliveries.

Amazon denied the accusations, stating that it terminated the accounts of sellers who tried to take advantage of the health crisis.

In February, bosses of leading stores in the UK, including Tesco, wrote a letter to Rishi Sunak, urging him to reform business rates to help them compete with companies like Amazon.

Amazon's UK sales in 2020 were around £19.3 billion, up 51 per cent since 2019, according to official figures. However, researchers at real estate adviser Altus Group estimate that Amazon's overall business rates bill for 2020-2021 was around £71.5 million - just 0.37 per cent of its retail sales.

High street retailers, in comparison, paid about 2.3 per cent of their annual retail sales in business rates before the pandemic, according to researchers.

Employees who refuse to sign new contract risk losing their jobs

Teleperformance, a call centre company working with Uber, Apple and Amazon, is installing AI-powered cameras at employees' homes to observe and record their workspaces, according to an investigation by NBC News.

Six Teleperformance workers based in Colombia told NBC they are being pressured to sign a new, non-negotiable contract that grants their employer the right to install cameras in their homes, for monitoring purpose.

Employees who refuse to sign have been warned they may lose their jobs.

The use of the cameras is not limited to Colombia: Teleperformance, a French firm, operates in 80 countries around the world.

The contract, first issued in March, requires workers to agree to share their biometric data like photos and fingerprints. They must also share video streams from the camera.

Employees said they were concerned about the contract, which enables Teleperformance to monitor them in real-time. The AI-based system also scans the entire room for objects like smartphones, paper and other items, in accordance with the firm's 'Clean Desk Policy'.

A clause in the contract also requires employees to agree to (notoriously unreliable) polygraph tests, if requested.

"The contract allows constant monitoring of what we are doing, but also our family," said a worker on the Apple account who was not authorised to speak to the news media.

"I think it's really bad. We don't work in an office. I work in my bedroom. I don't want to have a camera in my bedroom."

Teleperformance has a workforce of around 380,000 people in more than 80 countries. The company's website says it 'integrates advanced technology with a human touch' to offer 'remarkable' experiences to customers.

Teleperformance spokesperson Mark Pfeiffer told NBC that the new contract is meant to "[ensure] data security compliance, since many employees have access to sensitive client data during work." He added that "privacy and respect" are "key factors in everything" they do.

Apple and Amazon said they did not ask Teleperformance to monitor employees working on their projects.

Apple spokesperson Nick Leahy said that the company "prohibits the use of video or photographic monitoring by our suppliers, and have confirmed Teleperformance does not use video monitoring for any of their teams working with Apple".

Uber acknowledged that it uses camera monitoring services from Teleperformance to ensure that only authorised workers access sensitive customer data, and that screen data is not being recorded.

The company does not require any additional monitoring, the spokesperson added.