Karen Millen payroll ‘issues’ leave employees short-changed

Employees of fashion retailer Karen Millen’s Irish stores have been underpaid by the company for at least four months as a result of “issues” in the company’s payroll processes.

Controlled by a holding company connected with defunct Icelandic bank Kaupthing, the retailer's Irish arm has expressed its concern at the payroll problems, promising to reimburse employees.

One employee who asked not to be named, said the issues date as far back as October 2018. Employees have found themselves being put on an incorrect tax band, receiving incorrect wage payments, and suffering both delayed wage payments and, in some cases, no holiday pay.

Karen Millen conceded there had been a problem but declined to comment on the nature of the issues.

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The employee also noted that staff can’t directly contact the payroll company. They were previously directed to Revenue which advised that the problems flowed from the company itself.

“A lot of people have walked out of the job and handed in their notices,” the employee said, citing at least five cases across multiple locations.

A spokeswoman for Karen Millen said the company takes the wellbeing of its employees “very seriously”. It is “undertaking a detailed and thorough review of our payroll processes to ensure this doesn’t happen again”.

Asked when employees would be reimbursed, the company declined to comment. It is understood that the issue relates to the payroll provider rather than an internal issue at Karen Millen.

While the retailer maintained that these issues applied only to a “small number” of workers in their stores, it wouldn’t be drawn on how much money was involved.

Fall in profits

The payroll glitches at the Irish arm of the company follow a 50 per cent fall in pre-tax profits for the retailer’s Irish arm in the year to February 24th, 2018, the most recent period for which accounts are available.

The fall came despite a 5 per cent rise in revenue to €5.9 million in a year that was described by directors as a “period of operational stability”.

The Irish business emerged from examinership in 2015 after entering the process in November 2014. Examinership had followed years of sales declines – in 2011, it had recorded sales of €10.8 million.

The company is active across eight locations in the Republic in counties Cork, Dublin, Galway, Kildare and Limerick. In addition to standalone stores, it has an outlet in Kildare Village and concessions in Brown Thomas and Arnotts.