// Arcadia Group agrees to pay full salaries for head office staff facing redundancy
// Follows reports that it was only going to pay some of its staff as little as 50% of their notice pay
// Legislation prevents businesses using the furlough scheme to calculate redundancy payouts
Sir Philip Green’s Arcadia Group retail empire has performed a u-turn and agreed to pay full salaries for head office staff facing redundancy.
It comes after reports that Arcadia Group – the parent company of fashion retailers Topshop, Evans, Wallis, Burton and Dorothy Perkins – was only going to pay some of its staff as little as 50 per cent of their notice pay.
An Arcadia Group spokesman said its actions related to around 300 redundancies in head office, and that the firm was “extremely sorry to all those individuals impacted for the distress that we have caused and apologise unreservedly”.
- Arcadia accused of offering redundancies based on furlough instead of full pay
- Sir Philip Green’s Arcadia Group up for another restructure
- Arcadia scraps 500 head office jobs to offset Covid-19 costs
The news comes after some furloughed staff who are contractually owed more than the statutory minimum were informed that their payments would be calculated based upon the 80 per cent pay they earned while on the government’s coronavirus job retention scheme.
The government has already introduced legislation that aims to prevent businesses using the furlough scheme to calculate redundancy payouts.
“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,” Arcadia Group said in a statement.
“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.
“We are extremely sorry to all those individuals impacted for the distress that we have caused and apologise unreservedly.”
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.
It has hailed the promise to pay head office staff full pay during their notice period as a welcomed u-turn and an ”amazing victory”.
Arcadia Group is in the midst of making up to 500 head office staff redundant after the Covid-19 pandemic and subsequent lockdown had a dramatic impact on sales despite a surge in online revenue.
It said it had to make “many tough decisions”, including the restructuring of its offices.
The firm also said it looked to protect the welfare of its staff and customers – and observed all the guidelines and legislation during these exceptional circumstances.
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 Sir Philip 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.”
She said it may also serve as a warning for employers who use of the government’s furlough scheme which aims to help protect job during the pandemic.
“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,” she said.
“Unite will want to examine the Arcadia statement in detail before finally deciding to withdraw our legal action.”
with PA Wires