UK fashion retailer Quiz said today it had suspended its ties with a supplier accused in a weekend newspaper report of not meeting minimum wage requirements at a factory in the city of Leicester.
Quiz shares opened 21% lower after The Times reported that workers at the factory had been offered as little as £3 an hour to make clothes for Quiz.
The UK's minimum wage is £8.72 for people over 25 years old and £8.20 for people aged 21 to 24.
The Times report followed allegations of poor working conditions at suppliers to online fashion retailer Boohoo, which sent its shares 28% lower last week.
Quiz said it was investigating the allegations.
It said its initial review found that one supplier in Leicester had used a sub-contractor in direct contravention of a previous instruction.
It said it was this sub-contractor that was the subject of the wages complaint.
"We are extremely concerned and disappointed to be informed of the alleged breach of National Living Wage requirements in a factory making Quiz products," Quiz CEO Tarek Ramzan said.
"The alleged breaches to both the law and Quiz's Ethical Code of Practice are totally unacceptable," the CEO added.
Quiz said relationships will be terminated with any suppliers who fail to comply with this code or meet the group's standards.
It has committed to a full review of its auditing processes to make sure they are robust enough to ensure on-going compliance with its code throughout the supply chain.