Karen Millen and value footwear retailer Shoe Zone are among 179 businesses to have been “named and shamed” by the government for failing to pay the minimum wage.
As well as recovering payback for the 9,200 workers involved, the Government has fined employers a total of £1.3m in penalties for breaking national minimum wage laws. The most prolific sectors in this round of names were retailers, as well as hospitality businesses and hairdressers.
A representative for Karen Millen said: “A routine audit by HMRC in 2016 revealed that a number of our store associates were unintentionally being paid less than the minimum wage when our wardrobe policy was taken into account. The wardrobe policy at the time required our store associates to wear Karen Millen items, which they were able to purchase at a discount.
”Karen Millen takes the satisfaction and wellbeing of our staff very seriously. Following completion of the audit by HMRC, we acted quickly to remedy the situation, including arranging to reimburse affected staff and updating our wardrobe policy to ensure there could be no reoccurrence of the issue.”
A spokeswoman for Shoe Zone said: “As soon as the company was made aware of this issue by HMRC, which has been common practice within retail for a number of years, management worked with HMRC to remedy the situation as quickly as possible. The company now provides shoes for all store employees and contributes financially to allow employees to purchase their own trousers.”
Drapers has contacted Crystal Knitwear for comment.
The news comes ahead of a planned rise in the National Living Wage, which will increase from £7.50 to £7.83 per hour on 1 April. Later this month, the Department for Business, Energy and Industrial Strategy is also launching a campaign to raise awareness of the new rates, and will encourage workers to speak with their employer if they think they are being underpaid.