The CEO and founder of fashion retailer Ted Baker has resigned following allegations of sexual misconduct made against him last December.
Ray Kelvin took a voluntary leave of absence from his role as chief executive in December 2018 after allegations of misconduct centring around “inappropriate hugging” and “further serious allegations” were made against him.
An internal independent committee of non-executive directors appointed law firm Herbert Smith Freehills to investigate the allegations and the company’s policies, procedures, and handling of HR-related complaints. The investigation is ongoing. The firm hopes to report its findings either later this month or early April.
Kelvin has denied all allegations of misconduct.
Under the terms of his resignation, Kelvin will not receive any severance pay. Any bonus payments he has earned for the past three years’ performance will also lapse. He still owns a 35 percent stake in the company.
Former Chief Operating Officer and acting CEO Lindsay Page has agreed to continue in the role while David Bernstein will continue to act as executive chairman until 30 November 2020 at the latest. Sharon Baylay, an executive coach who joined Ted Baker as a non-executive in June, has agreed to act as the designated non-executive director for engagement with the company’s workforce. She is also chair of the investigating committee.
U.K. government outlines plans to rein in confidentiality clauses and NDAs
The rules around non-disclosure agreements (NDAs) and confidentiality clauses are set to be tightened so individuals cannot be prevented from reporting workplace crimes, harassment, or discrimination to the police.
The U.K. government is concerned that NDAs and confidentiality clauses are being abused by some employers to conceal incidents of harassment and discrimination, including sexual assault, physical threats, and racism, as well as to intimidate whistleblowers—despite the fact that no provision can remove a worker’s whistleblowing rights.
“Gagging orders” and “hush payments” have come under increased scrutiny following revelations of bullying behaviour by executives who have recently fallen from grace. Hollywood producer Harvey Weinstein is believed to have used NDAs to silence claims of sexual assault and misconduct for years while former BHS boss Sir Philip Green used them to prevent at least five former employees from publicly revealing his alleged bullying, sexual, and racial abuse against them.
The government believes such strong-arm tactics silence victims and prevent others from coming forward with legitimate concerns.
Under the new legal proposals announced by Business Minister Kelly Tolhurst MP on 4 March, the government will:
- Clarify in law that confidentiality clauses cannot prevent people from speaking to the police and reporting a crime (or prevent the disclosure of information in any criminal proceedings);
- Require a clear, written description of rights before anything is signed in confidentiality clauses in employment contracts or within a settlement agreement; and
- Extend the law so that a worker agreeing to a settlement agreement receives independent advice. Furthermore, the advice must cover the limits of any confidentiality clauses in the settlement agreement so a person is in full possession of all the relevant facts—this will help to prevent employees from being duped into signing gagging clauses which they were unaware of.
The consultation runs until 29 April 2019 and is available at: https://www.gov.uk/government/consultations/confidentiality-clauses-measures-to-prevent-misuse-in-situations-of-workplace-harassment-or-discrimination
In a statement, Bernstein said Kelvin had been the “driving force” behind Ted Baker becoming a global brand. But he added that “in light of the allegations made against him, [Kelvin] has decided that it is in the best interests of the company for him to resign so that the business can move forward under new leadership.”
“As a board of directors, we are committed to ensuring that that all employees feel respected and valued,” Bernstein said.
“We are determined to learn lessons from what has happened and from what our employees have told us and to ensure that, while the many positive and unique aspects of Ted’s culture are maintained, appropriate changes are made,” he continued. “We are confident that the strong and experienced team we have in place will build the Ted culture and move the business forward.”
The original allegation against Kelvin was made on 2 December when an anonymous employee launched a petition on the campaigning workers’ rights Website www.organise.org.uk highlighting Kelvin’s apparent preference for hugging rather than a handshake.
Addressed to Ted Baker’s board, the petition text read: “Put an end to forced ‘hugging’ by the CEO. It is part of a culture that leaves harassment unchallenged. Please set up a way of reporting harassment to an independent, external body—HR has done nothing with the reports of harassment to date. 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.” The petition currently has 2,710 signatures.
The Webpage also contained alleged details of Kelvin’s behaviour in the workplace. These included inappropriate touching, making sexual innuendoes, and asking young female members of staff to sit on his knee, cuddle him, or letting him massage their ears. It is also alleged that he took off his shirt on one occasion and talked about his sex life. The person who launched the online petition said HR’s complaints procedure was “hopelessly ineffective.”
“I went to HR with a complaint and was told ‘that’s just what Ray’s like,’ ” she said.
The company acted quickly to address concerns. On 3 December, in response to a slew of negative media coverage, Ted Baker announced it had set up its independent committee to look into the allegations and take “appropriate responses.” On 6 December, the company then appointed Herbert Smith Freehills to conduct an independent investigation.
At the time, Nat Whalley, CEO of the Organise Website, praised the speed at which the company reacted to the allegations, saying that “this is a huge victory for the staff campaigning for an end to harassment at Ted Baker.”