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Arcadia accused of potential legal breach over redundancies

Tom Shearsmith
25 August 2020

Arcadia Group, the owner of Topshop and Topman has been accused of a potential breach in employment law, offering some furloughed staff who are being made redundant less favourable terms for their notice periods.

Sir Philip Green’s struggling Arcadia Group, which also owns Miss Selfridge, Evans, Wallis, Burton and Dorothy Perkins, is making up to 500 head office staff redundant after a slowdown in trade during the COVID-19 pandemic.

While some staff members will receive full notice pay, furloughed workers who are contractually owed more than the government’s statutory minimum have been told that their payments will be based on the 80% of pay they received whilst on the scheme, according to The Guardian.

The government's statutory minimum payment is a week's pay for staff who have been with a company for less than two years, with an additional week's pay for every year worked after that, up to a maximum of twelve weeks.

Arcadia’s plans come only weeks after the government quickly pushed through legislation which intended to prevent companies from using furlough rates of pay as the basis for redundancy terms.

A spokesman for Arcadia told The Guardian: “Throughout this process we will be following all of the government guidelines and legislation. We are listening closely to all of their concerns throughout this process in what we know is a very difficult time.”

Last month, it was reported that the company has a deficit of £727m in its pension funds.

It has previously been reported that the 550-store group was in talks with landlords over leases with rolling break clauses, allowing the group to terminate a lease at any time during a term.

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