Ted Baker to investigate 'forced hugs' culture; shares tumble
Ted Baker shares tumbled on Monday as it said it will launch an investigation following a petition from its staff over a culture of "forced hugs" at the company, with founder and chief executive officer Ray Kelvin under fire for his behaviour.
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The statement from the fashion chain comes after an online petition was set up demanding that the group introduce a way of reporting allegations of harassment to an independent, external body as its own HR department has failed to take any action.
The petition on workplace site Organise, which is backed by more than 200 Ted Baker employees, calls for an end to the company's forced hugs and harassment.
The petition urges the board of directors to "put an end to the awkward 'hugging' policy".
"It's inappropriate and is part of a culture that allows harassment to go unchallenged," it read.
"Directors who abuse their power should be held to account. Harassment at Ted Baker is well documented but wilfully ignored by those in charge.
"It's time to break the silence."
One Ted Baker employee said that Kelvin "always wants a hug from every member of the staff".
"It’s very uncomfortable and unnecessary, a simple handshake can be okay. He has kissed the back of the ears of some of the people that work there too."
Meanwhile, a former employee accused the CEO of massaging her shoulders and kissing her on the neck.
"I was a 21 year old girl and it was my first ever ‘proper’ job," she said.
Ted Baker said in a statement: "Ray greets many people he meets with a hug, be it a shareholder, investor, supplier, partner, customer or colleague."
It said that while hugs have become part of the culture, they are "absolutely not insisted upon".
"While the claims made are entirely at odds with the values of our business and those of our CEO, we take them very seriously and will ensure that a thorough independent investigation is carried out."
Ted Baker said an independent committee of the non-executive directors has been appointed to ensure that the views and concerns are "recognised and carefully considered and that appropriate responses are taken forward".
Through Organise, there are now over 50 recorded incidents of harassment at Ted Baker, with Kelvin even accused of openly asking staff for sex.
At 1020 GMT, the shares were down 14% to 1,566.61p.
Neil Wilson, chief market analyst at Markets.com, said: "I guess the reports are a worry for investors as it could lead to Kelvin having to depart, which introduces a degree of leadership risk to the stock."