An online campaign claiming to represent over 200 employees has called on the company to end “forced hugging” and “a culture that leaves harassment unchallenged”.
The company, which issues a trading update on Thursday, says hugs are “part of Ted Baker’s culture, but are absolutely not insisted upon”.
It said Mr Kelvin greeted many people with a hug, “be it a shareholder, investor, supplier, partner, customer or colleague”.
The petition on the workplace website Organise had more than 2,000 signatures by Sunday evening.
It is also claimed that as well as engaging them in unwelcome embraces, the brand’s founder asked young female members of staff to sit on his knee, cuddle him, or let him massage their ears.
They also allege that millionaire Mr Kelvin, who launched Ted Baker more than 30 years ago, regularly uses sexual innuendo.
But Ted Baker also said that the matters raised in the petition were “at odds with the values of our business and those of our CEO”.
And it said it would “ensure a thorough independent investigation is carried out” into the allegations.
Another complaint made in the petition is that previous complaints have been ignored. “Please set up a way of reporting harassment to an independent, external body – HR has done nothing with the reports of harassment to date,” says the petition.
But the firm said there were “very 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”.
Ted Baker, named after a fictitious alter ego of Mr Kelvin, opened its first store in Glasgow in 1988 and now has 544 outlets worldwide selling fashion and accessories.
Mr Kelvin is worth £522m according to the Sunday Times Rich List.
There was no direct comment from Kelvin himself who owns around 35 percent of the company according to Refinitiv Eikon data.