Hundreds of Patisserie Valerie staff who lost their jobs last month have not received their final pay packet.
Just over 900 cafe workers lost their jobs when 70 of the cafe group’s near 200 stores and concessions closed in January.
Patisserie Holdings, the parent company that also owns the Druckers Vienna Patisserie, Philpotts, Baker & Spice and Flour Power City brands, went into administration last month after discovering a £40m black hole in its finances in October. The company blamed the problem on “potentially fraudulent” accounting irregularities and the Serious Fraud Office is investigating.
The company’s chairman, Luke Johnson, said he had personally extended a £3m interest-free loan to help ensure January wages are paid to all staff.It is understood that loan is being used to pay staff at the 130 stores that remain trading but does not cover pay for those being made redundant.
One former Patisserie Valerie worker, Hannah Milne, told the Guardian she had been informed over the phone that she had lost her job in a very short conversation and was shocked to discover she had not been paid this week for her final month’s work. She said she had been forced to borrow money from her family.
“It happened so close to payday nobody was prepared for it,” Milne said. “I feel really screwed over. You put hard work into the company and all you expect is to be paid your wage and a little respect. The company is getting to go on trading and making money while I sit at home struggling to pay my bills.”
Milne said that she tried to contact the company but was told there was nothing she could do to reclaim her pay.
One member of staff who will not receive any statutory redundancy pay because he has worked for Patisserie Valerie for less than two years has set up a petition in an attempt to persuade the company to pay staff.
KPMG, which is acting as administrator to Patisserie Holdings, has said it is providing members of staff who have been made redundant with assistance in making claims to the government-backed Redundancy Payments Service, which helps cover wages owed and statutory redundancy pay at insolvent companies.
A spokesperson for the administrators said: “We recognise this is a very difficult time for those members of staff who have lost their jobs, and are providing them with support, including assisting with claims to the Redundancy Payments Service.”
Dave Turnbull, of the Unite union, advised workers to write to Patisserie Valerie and demand their pay.
“The company is still trading so it does still have some money. They should be demanding they get paid,” Turnbull said. “This could be unfair dismissal. Even if the company is in administration, it should have gone through the proper process to make them redundant.”.
KPMG is considering bids from dozens of interested parties understood to include cafe entrepreneur David Scott, the former owner of the Druckers chain which Patisserie Valerie took over, and a mix of private equity and trade buyers.
Costa Coffee, which is now owned by Coca-Cola, Caffè Nero and Leon are thought to be interested in parcels of stores, but administrators are hopeful of finding a buyer who will run a significant part of Patisserie Valerie as a going concern.