Edinburgh pancake cafe staff promised furlough wages waited two months to be told they wouldn't get the money - then were refused hours due to 'business needs'
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Employees on zero hours contracts at Coro the Chocolate Cafe in Edinburgh's Frederick Street were sent letters on March 27th reassuring them they would be paid and would not need to claim benefits - but they say they were repeatedly fobbed off by owner Paul Hutton when they queried why it was taking so long to get the money.
But Mr Hutton says he only learned at the end of April, when the furlough money was due to be paid out, that he would not be receiving it as previous emails from HMRC alerting him to the issue had gone straight into his junk mail.
The 29-year-old says he then pushed HMRC to resolve the issue, which has been drawn out through their complaints process, and revealed to staff on May 19th that they would not be paid - but he insists he is "fighting tooth and nail" to reclaim the furlough money and will even consider court action.
He said about 24 staff in both his Edinburgh and Glasgow cafes who work on zero hours contracts have been affected. He claims he paid them for the hours they worked just before lockdown and another two weeks wages - and has extended the company's overdraft and used £2,000 of personal savings to help "three or four" of them out.
But the Evening News has spoken to three staff members in the Edinburgh branch who say their latest pay only covered the last few hours of work completed before lockdown started in March.
One, who did not want to be named, said she had to leave her Edinburgh flat because she couldn't afford the rent, adding: "It just seems like such a lack of respect and a kick in the face and it feels like we have just been treated as a number."
Another employee said: "They have treated us so badly. We have not known what's been going on and it's been a long, stressful financial process which has left us all feeling really disappointed."
Mr Hutton says that zero hours contract workers are not entitled to be legally paid in this case and that his lawyer says they have already been paid for the hours worked.
Cafe jobs advertised
The Evening News has seen texts in a group messaging app sent from Mr Hutton, on May 19th, telling staff they would not be getting furlough wages and advising them to find "alternative working arrangements" but that employment would continue "unless you decide otherwise."
In late June, management sent staff another message offering working hours in time for the reopening in mid July but some people were declined this due to "business needs."
Mr Hutton also acknowledged that he advertised three new jobs the day after this, which he said was to recruit and train new staff in time for the business reopening on July 15th to cover for employees who had already gone home. He said this wasn’t done in Glasgow as there are more full time workers there.
A third employee at the Edinburgh branch said this was "another blow" as they had been hoping to get back to work, adding: "It's really hard to understand why it would take so long for a small issue to not be brought up sooner.
"It's clear they are trying to look for new staff, I am guessing to replace us.
"I feel really let down. I have been working there coming up two years and it just feels like I have not been appreciated or valued."
A number of staff in the Edinburgh cafe have collectively lodged a formal grievance with their employer concerning the matter - and some say they feel it might end up in a tribunal.
Mr Hutton said: "I understand their frustration and they have bills to pay and I have done everything I can to get them money and have even offered them personal loans.
"I care about them. They are hard working individuals and I feel bad for them but I am still fighting tooth and nail and hoping to get a positive outcome, and if I don't I will be taking HMRC to court."
Mr Hutton says his complaint to HMRC is now being looked at by an adjudicator.
A HMRC spokesperson said: “We don’t comment on identifiable businesses.
“The Coronavirus Job Retention Scheme is part of the collective national effort to protect jobs.
“We have received 3,858 reports from the public. Reports can be submitted to us entirely anonymously and everything we receive is assessed and a decision made on the most appropriate course of action. We’re not trying to catch people out – if it turns out to be a genuine mistake then we’ll help put it right, and if it’s more serious then we’ll step in.
“Information can be reported via our online digital reporting service which is available on gov.uk.”
Benjamin Napier, chief executive of Citizens Advice Edinburgh urged any employee who is concerned they haven't received their entitlement or not had their employment rights upheld to contact them on 0131 510 5510, and they will provide them with advice specific to their circumstances and help negotiate with their employer.
Mr Napier also encourages employers who are concerned they may not fully understand their obligations under the furlough scheme to contact them.
He said: "We recognise that it is a difficult time for everyone and that the pace of change has been rapid, so our aim is to provide as much up to date information and advice as we can to help ensure every individual receives the income they are entitled to and that local businesses are supported to retain employment."
Coro the Chocolate Cafe went into liquidation at the end of 2018 and Mr Hutton said this was because they were hit with a backdated VAT bill which has now been repaid.
He says there have not been any issues with trading of late.
Coro specialise in chocolate laden desserts, including several pancake dishes.