Revealed: UK fast fashion staff deprived of pay and benefits by jobs agency | Employment law

A jobs agency that supplies warehouse workers to fast fashion and high street brands repeatedly underpaid staff and deprived them of holiday pay, an Observer investigation has found.

Workers hired on zero-hours contracts to help process orders for PrettyLittleThing, its parent company Boohoo, The Very Group, Sainsbury’s and Currys are among those who claim to have had wages withheld by Mach Recruitment.

In an employment tribunal judgment handed down in May 2022 – one of six so far this year – Mach was ordered to pay £1,184 to a worker who worked 12 shifts at a warehouse for The Very Group in 2021 but never received his wages. In June 2022, the agency was ordered to pay £138 for taking unauthorised deductions from a worker’s salary, including failing to pay his holiday entitlement. In July it was ordered to pay £430 to a worker who claimed that she had not been paid for shifts. In another case last June, Mach was ordered to pay a worker £12,000 for unfair dismissal, £3,960 for unpaid bonuses, and £1,064 for unpaid holiday, tribunal records show.

In all, the agency has been taken to 12 employment tribunals in the past two years that resulted in it being ordered to pay money to workers, including 10 involving unpaid wages, unauthorised salary deductions or a failure to award holiday pay.

Mach did not engage in the cases and failed to answer calls and emails from the tribunal service, according to the judgments. In a statement this weekend, the firm blamed the communication and pay issues on Covid-19, adding that the claims were unfounded and that it was challenging the rulings.

As well as examining cases that went to tribunal, the Observer spoke to eight former Mach workers who were at the company between 2020 and 2022 and analysed evidence including pay slips, contracts and text and email correspondence that suggest the practice of underpayment is widespread.

Mo Ajala, 23, who was hired to pick orders in PrettyLittleThing’s Sheffield warehouse during the pandemic, said he fought for more than six months to be paid for a week of night shifts. Despite repeated phone calls and texts to Mach’s offices, the business graduate was ignored. “I’d call up and they’d say ‘We’re going to pay you this week’. Then one week, two weeks, three weeks, four would pass,” he said.

He was eventually paid £289 after raising the case with Acas, which provides support with employment disputes, and later taking Mach to a tribunal, which found in January 2021 that the agency had made an unlawful deduction from his wages. Mach did not engage with the process. “It was really stressful to go through all that just to be paid the money I was rightfully owed,” Ajala said. “They didn’t even turn up. It felt like they didn’t care.”

Lalit Yadav, 25, a masters student from India, provided documents to support a claim that he too was underpaid by Mach. Yadav took a part-time job at a Sainsbury’s distribution centre near Leeds in February, juggling night shifts with his studies. He had to take three buses to reach the warehouse, and the physically demanding work resulted in him losing 18kg in two months. But he didn’t mind “working to the fullest” because his wages – paid regularly at first – helped him cover living costs.

The problems began three months in, when he noticed he had not been paid for an eight-hour night shift he says he worked in June. He claims Mach told him it needed additional documents to process the payment, so he supplied them, but that he was then told he had not worked that shift. “I’m pretty sure they could check the cameras, and they must have records of me clocking in and out. But for some reason they don’t seem willing to check: they’re just telling me, ‘You must have not worked this day,’” Yadav, who subsequently quit, said. “It was really demotivating to not be paid after working so hard.”

Yadav says he called Mach repeatedly to try to resolve the issue but was passed between members of staff who either said they couldn’t help or promised to but failed to take any action. Eventually he gave up. Others say they were only paid after messaging the firm’s executives on LinkedIn or by posting on the company’s Facebook and Instagram pages.

Mach has grown rapidly in the past two years. Records show the company had an average of 9,542 temporary workers a month on its books in 2021, up from 5,783 in 2020, while its turnover almost doubled from £110m to £200m and its profit before tax trebled to £3.8m.

Its advertisements targeting jobseekers paint a glossy picture. Earlier this month the company launched a campaign to attract workers for PrettyLittleThing, a fashion brand known for its cheap clothing whose “ambassadors” include Love Island stars Molly-Mae Hague and Gemma Owen. The ads promise workers will benefit from a “friendly environment” and earn “excellent hourly rates” starting at £9.90. In earlier recruitment drives, Mach posted videos on TikTok showing workers dancing at a PLT warehouse. It has also run recent recruitment drives for The Very Group, which owns Littlewoods, and for food warehouses across the UK.

Jamie Woodcock, author of The Gig Economy and senior lecturer in management at Essex University, said Mach’s practices appeared “deeply exploitative” and could lead to low-paid workers receiving less than the minimum wage. “If you systematically underpay people and systematically underpay holiday, you’ll get picked up every now and again for a tribunal case. But overwhelmingly you’re lowering the cost of that labour, because many people won’t chase it or don’t know how to,” he said.

As well as problems with wages, many of the complaints against Mach relate to workers not being paid holiday entitlement they were owed. Although agency workers have fewer rights than permanent staff, they are still entitled to at least 5.6 weeks of paid holiday a year.

Lee Robson, 47, who worked night shifts at Boohoo’s Burnley warehouse until October 2021, says he didn’t take any holiday during that time, so was expecting a lump sum that would tide him over until he started his new job. But when he got his final pay packet the holiday pay wasn’t included, he says.

When he called the Mach office he says he was told he needed to fill in a form, but even after doing so he says he wasn’t paid. “I was calling the numbers for the recruiters and they were ignoring me, blocking my number or passing me on to someone else,” he said.

One day, after about three months, the £380 arrived in his bank account without explanation. He believes Mach paid him because he was “pushy” but that not everyone would not have gone to the same lengths. “It was becoming a bit of a nightmare,” he said.

Father-of-two Steve Smalley said he did not automatically receive holiday he was owed after leaving his role at a warehouse for Currys in Newark, Lincolnshire, in January.

When he raised the issue with Mach he says he got “blanked left, right and centre”. He claims he only received the outstanding £180 in April after messaging a senior manager on LinkedIn in an attempt to avoid going to court. “It was very frustrating. A few months later I started getting texts saying, ‘We have shifts available.’ I thought ‘You cheeky buggers,’” he said.

Nick Clark from the Unpaid Britain project, which investigated wage theft in the UK, said the issues with Mach were a “familiar story” and echoed cases in other sectors. He called for more effective enforcement and said the system needed to improve to hold “repeat abusers” to account. He said tribunals could issue fines in cases where employers had behaved “particularly badly” but that the powers were “very rarely used”. They don’t seem to look at how many other cases there have been,” he said.

Ryan Bradshaw, a solicitor specialising in employment cases at the law firm Leigh Day, said companies that outsourced recruitment to third-party agencies had a “moral responsibility” to ensure workers were properly paid. “Outsourcing allows companies to push responsibility on to someone else. But it’s not good enough. They must know these things are going on and if they don’t, they’re not paying enough attention,” he said.

Tom Zyzak, managing director at Mach Recruitment, said: “While we are aware that there a number of rule 21 judgments, whereby decisions were made automatically due to no response being received, a large proportion of these are down to claims raised during the Covid-19 pandemic and subsequent lockdown periods when offices, sites and business were closed down. When we were made aware of these, we immediately began the legal process of challenging the claims, as we believe them to be unfounded. The UK court system is experiencing a severe backlog of all tribunal cases so many of these are still being processed.”

When asked for further information the company said it was “unable to go into a lot of detail due to them being ongoing”, but that it was challenging all of the rulings.

Zyzak said all workers were paid holiday and bonuses owed to them and that Mach worked closely with clients to ensure wages were paid correctly. He said the company was aware of “a number of issues that impacted on our normally swift resolution time” and had “worked hard over the last six months” to address them, including expanding its teams and building new systems to “monitor and resolve all queries in a timely fashion”. “We process payroll for up to 15,000 colleagues weekly and our colleagues have multiple communication channels to escalate any queries accordingly,” he said.

Boohoo said: “We take employee welfare very seriously and will be investigating these claims carefully.”

Currys said its outsourcing partner GXO was investigating with Mach. “We expect the robust standards we set on supplier auditing, in line with our own rigorous supply chain due diligence process, to be upheld,” it said.

Sainsbury’s said it did not comment on specific cases but suppliers were expected to comply with the law and good industry practice, adding that it regularly reviewed its partners.

The Very Group said it worked with agencies to resolve payment problems swiftly and would “have an ongoing dialogue” with Mach and partners “to ensure robust policies relating to temporary colleagues” were followed.

The government said it could not comment on individual cases but took agency worker protections “very seriously”, adding that the Employment Agency Standards Inspectorate had “a good track record in protecting agency workers”.

Precious Ebere, 29, who moved to the UK from Nigeria to study public policy, and is co-founder of Do Take Action, a non-profit that campaigns on social issues, said she was not paid for several shifts while working at a warehouse in Cardiff via Mach in 2021. “I thought, ‘I can’t let this lie’. I went to the office and said, ‘I need my money’. At that period I was losing my house. I was struggling for money. It was really bad,” she said.

Emails show that four months on, after challenging managers, Ebere was paid. But she said many others were afraid to speak out. “People don’t complain because they need money. But you work so, so, super hard. You work so damn hard. And they don’t even pay us,” she said. “It makes you feel worthless. They need to be held accountable.”