Retail tycoon Sir Philip Green’s Arcadia Group has announced full payouts for head office staff facing redundancy, in a reversal.
Arcadia, whose high street brands include Topshop, Topman, and Dorothy Perkins, previously said it was only going to pay some of its employees as little as 50% of their notice pay.
The fashion group’s actions relate to around 300 redundancies in its head office, a company spokesman said that Arcadia is “extremely sorry to all those individuals impacted for the distress that we have caused and apologise unreservedly.”
“We recently implemented a policy for those employees who are working their notice on furlough to receive their furlough pay instead of their full pay.
“We got this decision wrong and the Board has today amended this policy to ensure all affected employees will receive their full pay. They will be notified of this decision immediately,” the company said in a statement.
The Unite union said it had threatened to take legal action for illegal deduction of earnings on behalf of more than 40 head office staff.
Responding to the U-turn, Unite said its an ”amazing victory” and hailed the promise for full payouts for staff during their notice period as a welcomed U-turn.
Unite regional officer Debbie McSweeney said: “We understand that it is almost without precedent for Arcadia to apologise for such behaviour towards employees – but this situation should have never been allowed to happen in the first place by Green, one of the country’s richest men.
“Unite would like to sincerely thank our members for the solidarity and personal courage they have shown in standing up to Arcadia’s management and playing their part in righting a flagrant pay injustice. It is an amazing victory.”
McSweeney claimed it may also serve as a warning for companies who use Rishi Sunak’s furlough scheme which aims to help protect jobs during COVID-19.
She said: “This puts down a strong marker to other employers who may be thinking of taking advantage of the Government’s furlough scheme – Unite is on high alert for such cases and how they may adversely affect our members.
“Unite will want to examine the Arcadia statement in detail before finally deciding to withdraw our legal action”, she added.
On making the decision, Arcadia said that it had been “forced to make though decisions” during the coronavirus crisis, including the restructuring of its offices. The company said it looked to protect the welfare of its employees and customers, and observed all the guidelines and legislation “during these very exceptional circumstances.”
In 2002, the group owned by Green and his family became part of Taveta Investments.