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Two of Scotland’s most successful businessmen have been condemned for threatening workers with a shameful 1p-an-hour pay rate.

Edinburgh-based vaping tycoons Callum and Connor Henderson wrote the terms into contracts for staff who had to leave their firm without being able to serve a full notice period.

The brothers – aged 30 and 33 – have been catapulted into the world of the super-rich after their VPZ electronic cigarette shop chain expanded across the UK.

But while they enjoy lives of luxury, politicians, unions and lawyers have reacted furiously to an employment policy thought to breach a raft of laws.

Documents passed to the Sunday Mail show that workers were told they could end up receiving just 1p an hour for time worked and holidays owed.

(Image: Collect)

After being confronted, the company claimed the clause had been removed from their terms of employment.

But a source said: “This was given to a worker in recent years and was the one they were employed under until leaving the company in recent months.

“It is disgusting to try to treat people like that and it would never stand up in court.”

The contract states: “In the event of an employee leaving the company without the proper notice period being served, the company will make payment of any outstanding hours worked and outstanding holiday entitlement owed by the company which will be calculated at the rate of 1p (one pence) per hour.”

Lawyer David Martyn, head of Thompsons’ employment rights unit, believes the terms wouldn’t comply with other laws to protect workers’ rights.

He said: “If you don’t have statutory rules governing the way people are paid, you will see this sort of punitive clause appearing more regularly.

“You can see what it is designed to do – punish people for not working their full notice period.

“But the reality is that if you have earned holidays, you are entitled to be paid for those under Working Time Regulations, and if you have done work, then you are entitled to be paid at the very least the National Minimum Wage.

“A contract cannot drop the rate of pay below the National Minimum Wage – it is a piece of legislation that is there to provide a floor.

“A term like that would seem to me to be void because it would be effectively overwritten by the statutory provisions which would be applied by a court.

“If you broaden this issue out, this is the concern about Brexit and attempts to deregulate the economy. You are in a situation where some of the basic rights that we rely on to create a fair working relationship are easily removed.”

Citizens Advice Scotland’s social justice spokesperson Mhoraig Green said: “This story will shock people across Scotland. The idea that workers could effectively be paid 1p an hour in any circumstance is utterly jaw-dropping.

“People not knowing their rights at work is an issue and that leads to some companies taking advantage of their workers.”

The meteoric success of VPZ has allowed the Henderson brothers to rake it in and splash out.

(Image: Collect)

Callum, 33, lives in a £2.5million six-bed Edinburgh mansion – complete with cinema and indoor swimming pool – with 32-year-old girlfriend Liliana Recinos from El Salvador.

Recinos regularly flaunts her extravagant lifestyle on Facebook, with pictures of their sprawling home and luxury holidays.

Connor, 30, lives in a turreted, seven-bed Victorian mansion set in two acres of land near Linlithgow, West Lothian, with his girlfriend Hrafnhildur Matthiasdottir, from Iceland, and their two daughters.

VPZ was the highest-placed Scottish firm in the Sunday Times Virgin Atlantic Top 100 in 2018, which ranks UK companies by sales growth.

They started with a single shop in Edinburgh’s Leith in 2012 but now have 150 outlets across Britain and 400 staff. Accounts show the firm turned over £26million in 2018 and VPZ is believed to be worth more than £100million.

But trade unions and politicians have reacted furiously to our revelations about their working conditions.

Bryan Simpson, of Unite, said: “Refusing to pay workers their statutory notice and holiday pay is not just morally unacceptable, it is most likely unlawful. To threaten workers with a fraction of their accrued holiday pay is disgraceful.

“Unfortunately, workers across the service sector are regularly met with punitive actions from employers who think they are above the law.”

(Image: Getty Images)

Labour’s finance and fair work spokeswoman Rhoda Grant said: “This is illegal – they cannot pay less than the minimum wage.

“Customers have huge sway over where they shop and should think carefully about the ethics of the companies they shop with.”

SNP MP Stewart McDonald said: “It is a scandal that a business that operates on virtually every high street in Scotland is trying to make a mockery of workers’ rights and our legal minimum wage.”

Scottish Lib Dems’ economy and fair work spokesperson Katy Gordon added: “This is an outrageous and unjustifiable pay policy. Staff should be paid in full for the hours they put in. It’s also an incredibly insensitive suggestion to staff who may be forced to leave prematurely due to unforeseen circumstances such as a family illness.”

In Scotland, VPZ sells Celtic and Rangers-themed e-liquids for their products priced at about £17.

According to Cancer Research UK, 9.4million people in the UK still smoke cigarettes while the number of vapers is estimated at three million and climbing.

VPZ is headquartered in Edinburgh’s Newbridge Industrial Estate.

A spokesman said: “The contract in question contains a clause from when the business was established in 2013. Our current employment contracts no longer contain this clause.

“VPZ is one of the UK’s fastest-growing companies, employing over 400 people in 150 stores throughout the country.

“We are a people business and continue to invest heavily in our employee strategy to train and develop our staff as we drive the next phase of growth for VPZ.

“We also operate an industry-leading staff performance scheme and have a number of highly talented staff who have risen from working in our retail network to director level and shareholders.”