Frasers Group, owned by British billionaire Mike Ashley, is currently under investigation by HM Revenue and Customs (HMRC) for potential abuses of the government’s furlough scheme. This investigation comes after a number of employees from Frasers Group, which encompasses popular retail brands such as House of Fraser, Sports Direct, and Flannels, filed complaints stating that they were asked to work while on furlough. According to a reliable source within HMRC, Frasers Group is at the forefront of the list of companies being considered for investigation.

However, Frasers Group is not the only retail business being scrutinized in this regard. Other notable companies, including Arcadia, owned by Philip Green and responsible for popular brands like Topshop, could potentially face examinations from tax officials. The same source from HMRC mentioned that they are already exploring the possibility of recovering a portion of the funds provided through the furlough scheme from these companies. If concrete evidence of wrongdoing is discovered, HMRC will take the necessary actions.

The allegations against Frasers Group revolve around the accusation that employees were asked to return to work in May to prepare stores for reopening, despite being officially on furlough. The government’s furlough scheme was promptly introduced to prevent large-scale job losses during the ongoing Covid-19 crisis. Under this scheme, the government pledged to cover up to 80% of eligible employees’ wages from March to June. However, it was explicitly outlined in the scheme’s regulations that furloughed staff should not engage in any work activities for their respective employers.

The outcome of these investigations and any subsequent action taken against Frasers Group and other implicated companies remains uncertain. Nevertheless, the results will undoubtedly carry significant implications for the retail industry as a whole, influencing public perception of businesses’ ethical conduct during the pandemic.

Useful links:
Government’s guidance on the furlough scheme
ACAS guidance for employers and employees during the pandemic