Several employees of Sir Philip Green who alleged the tycoon had sexually harassed or bullied them were given enormous seven-figure secret payouts to settle their claims, the Guardian has learned.

The huge settlements were part of a widespread culture of silence at Green’s Arcadia Group, an insider said, where the billionaire owner allegedly harassed female staff but few felt able to speak up, and where senior managers frequently ignored his behaviour.

The Guardian understands there are at least seven cases in which former staff members have received substantial payouts to settle complaints of sexual harassment, bullying or racist abuse against Green. In several of those cases, the sums involved reached seven figures.

The settlements, agreed by both sides, stopped them speaking out over their claims. It is not known whether these cases were among the five that were subject to a press injunction revealed earlier this week.

One incident of alleged harassment that led to a substantial payout was dismissed by a senior manager because “he didn’t really seem to think that there was anything wrong”, the insider told the Guardian.

“I don’t think he thought Philip was doing anything wrong, I think he just saw it as, that’s how it is.”

In that instance and others where staff raised grievances, “it was just a case of, to make sure this doesn’t go to court and to make sure nobody finds out, how many zeros do you want on the end of this cheque?”

The source alleged Green’s behaviour included:

walking into meetings and giving women present a lingering hug

asking women in meetings if they were “naughty girls”, and if they “needed their bottoms slapped”

creeping up behind women in corridors to make them jump, before caressing their shoulders to “reassure” them

calling women “sweetheart”, “darling” or “love”, rather than by their names

telling women they were overweight and should go on a diet

flying into expletive-ridden rages abusing male and female staff in front of colleagues

Senior executives at the company were aware of Green’s behaviour but had “no appetite” to challenge him, according to the source. When they raised the matter with colleagues “it would be [a case of] ‘Well, he’s old school, you can’t change that generation’. It was always played down.”

Green was named on Thursday in parliament as the businessman at the centre of a legal battle with the Telegraph newspaper, which has been blocked from publishing accusations against him of bullying and sexual and racial harassment of former employees, which it has described as a “British #MeToo scandal”.

The court of appeal had granted an interim injunction stopping the newspaper from publishing details of the alleged harassment because the complainants had signed non-disclosure agreements. This ruling overturned an earlier finding by the high court that disclosure was in the public interest.

On Thursday night, Green issued a statement saying: “To the extent that it is suggested that I have been guilty of unlawful sexual or racist behaviour, I categorically and wholly deny these allegations.

“Arcadia and I take accusations and grievances from employees very seriously and in the event that one is raised, it is thoroughly investigated.”

The source described a culture inside Arcadia’s Colegrave House headquarters in central London in which Green was “generally feared”.

“One thing that he said and did a lot, was walk into meeting rooms unannounced, because that is his vibe, and he would ask the women in the room, were they behaving, were they being naughty girls, and did they need their bottom slapped. That is almost his standard way of introducing himself into a room.”

The women present would react with “nervous laughter”, but rarely complained.

Green was also “very physical” with women, according to the source. “There were lots of hugs with women, particularly with senior women. I would describe them as overly long, lingering hugs.

“He would walk into meeting rooms that he didn’t need to be in, he would just walk in, say hi to people and hug all the women in the room. His hands weren’t anywhere inappropriate, just around their backs, but they would be quite long, not just a quick, hey how are you hug.” The men in the room would be greeted with a handshake.

The insider also witnessed several occasions when Green would “creep up behind women who were walking along the corridor in the office and shout ‘Boo!’ or something to make them jump, and then to ‘calm them down’ put his hands on their shoulders and rub them in a weird kind of massage”.

There was also “a general unofficial rule between women that you wouldn’t get into a lift with him”, the insider said.

One woman who asked Green to use her name in a meeting rather than “sweetheart” and “darling” was told to “shut the fuck up”. The source said they had witnessed an incident in which Green made a comment about a woman’s weight and said she “must be a lesbian because no man would marry her”, and another in which he asked an Asian woman if she had been “eating too many samosas”.

“He would make a lot of comments about women being overweight,” the insider said. “A lot of them weren’t overweight but they just didn’t fit his standard.”

Green and his wife, Tina, who controls the family empire, are worth an estimated £2bn, much of it accrued after his purchase of BHS in 2000 and the Arcadia Group, which owns Topshop, Topman and Burton, two years later.

The businessman was knighted in 2006 by Tony Blair for “services to retail” and in 2010 David Cameron appointed him as an adviser to review public sector procurement. However, his reputation plummeted in 2015 after he sold BHS, from which he had taken hundreds of millions of pounds in dividends, for £1 to a former bankrupt businessman. The company later collapsed with the loss of 11,000 jobs and a pension deficit of more than £500m.

Following high-profile calls that he be stripped of his knighthood, Green agreed to pay £363m into the pension scheme.

The insider said: “The culture in Arcadia is very much, it is all about Philip. He will go into a meeting room, or sit down with people and ask what they are doing, they will try to explain and he interrupts, calls people stupid, he says they are a waste of time, what they are doing is pointless. And that is within earshot and view of other people, so he will shoot people down in a public setting.

“He tries to frame it that he cares about Arcadia and its employees, but actually I think he is just getting off on the fact that he can make people feel like shit.”

The source said employees, particularly women, did not feel able to speak up, and managers were not keen to challenge Green. “Particularly if you are a fairly junior person, and it’s maybe your first job, I don’t think you would feel comfortable raising something about the guy who owns the company.”

Similarly, “if you are working for Arcadia and Philip is your boss, I don’t think there is any appetite to suddenly turn round and say, actually Philip, we think you have done something wrong here”.

According to allegations in an unofficial biography published earlier this year, Green once said to a female buyer at one of his firms: “You’re absolutely fucking useless. I should throw you out of the window, but you’re so fat you’d probably bounce back in again.”

Damaged Goods, by the Sunday Times journalist Oliver Shah, also reported that a black senior manager had walked out after a furious row with Green. Wesley Taylor, Burton’s brand director, alleged Green had used racially abusive language against him on several occasions, and threatened to take him to an employment tribunal. The matter was settled out of court. Green denied making racist remarks.

The biography also said the businessman often made female staff cry, and “delighted in undermining” senior staff.