Ray Kelvin has resigned as chief executive of Ted Baker with immediate effect amid claims that he enforced a “hugging” culture at the company.
Kelvin was forced to take a leave of absence following allegations of harassment.
Accusations were also made that he massaged employees, kissed their ears and asked some to sit on his lap.
Ted Baker said on Monday that Kelvin agreed to resign as chief executive and as a director of the retail chain.
Executive chairman David Bernstein said: “Ray Kelvin founded the business 32 years ago and has, together with the fantastic team around him, been the driving force behind it becoming the global brand it is today.
“As founder and CEO, we are grateful for his tireless energy and vision. However, in light of the allegations made against him, Ray has decided that it is in the best interests of the company for him to resign so that the business can move forward under new leadership.”
Kelvin said: “Difficult though this decision is given that Ted Baker has been my life and soul for over 30 years, I’ve decided that the right thing to do is to step away from Ted and allow the business to focus on being the outstanding brand it is so it can face 2019 with fresh energy and renewed spirit.
“As a shareholder in the business I’ll support Lindsay in his leadership and be available to him and the team wherever I can offer helpful advice.
“I’m extremely proud of what we’ve achieved in building Ted Baker to the global brand it is today. Thank you to every single colleague, customer, supplier, and investor for your commitment to the business. We couldn’t have done it without you and I’m so grateful.
“The past few months have been deeply distressing and I’ll now be taking time privately with my family to consider what my next adventure will be. Bye for now, Ray.”
Ted Baker was founded by Kelvin, who is known to shun publicity, in 1988 and has grown to include a portfolio of hundreds of stores worldwide.
It comes after Topshop tycoon Sir Philip Green was accused of widespread misconduct in a lengthy investigation in the Daily Telegraph.
Harassment claims in the business world have come under growing scrutiny in the past year following the #MeToo movement.