GLOBAL fashion group Ted Baker has denied staff are forced to embrace its founder amidst predictions of disappointing results to come.

An employee has launched a petition against “forced hugging” and accuses Ray Kelvin, who opened the first Ted Baker shop in Glasgow 30 years ago, of inappropriate behaviour.

This includes asking young women workers to sit on his lap, cuddle him or allow him to massage their ears, as well as using sexual innuendo.

Claims about 62-year-old

Kelvin, worth a reported £522 million, come days before a third quarter trading update is released on Thursday. City analysts predict this will reflect “challenging conditions” on the high street.

Caroline Gulliver, analyst at broker Jefferies, said: “After a subdued first-half performance we do not expect much relief in quarter-three given unseasonably warm temperatures across the UK and Europe for some of the autumn. Consumer confidence has also dipped across the UK and the eurozone, affecting 67% of group sales.”

Jefferies has now downgraded its full-year profit expectations for Ted Baker.

In October, the retailer revealed a hit from collapsed department store chain House of Fraser as it posted lower half-year profits.

The retailer said pre-tax profits fell 3.2% to £24.5 million in the six months to August 11, with the group writing off £600,000 owed by House of Fraser, which collapsed into administration in August and has since been bought by Sports Direct.

High street store sales plummeted 10.4% per square foot in constant currency. Responding to the “harassment” petition, Ted Baker said Kelvin uses hugs to greet shareholders, investors, customers and colleagues. Pledging to “ensure a thorough independent investigation is carried out”, it stated that embraces are part of company culture, “but are absolutely not insisted upon”.

Despite claims that “HR has done nothing with the reports of harassment to date”, it said there are “ clear and robust HR policies in place to provide all employees with a wide range of reporting options for any issues that they might encounter, including a completely confidential and anonymous, 24/7 helpline”.