Bosses at fashion company Boohoo – which has its main distribution centre in Burnley - have appointed a top lawyer to investigate allegations that one of its clothing suppliers is paying below minimum wage and breaching coronavirus safety rules.

The fashion retailer said that Alison Levitt QC would be reviewing its supply chain in a bid to find out whether factories were meeting wage and virus regulations.

The report is due to be published in September - alongside its half-year results and with a second update due in January 2021.

It comes after fashion brands Next, Asos and Zalando removed hundreds of Boohoo products from their website following accusations in a Sunday Times report.

An undercover reporter for the newspaper said that staff at Jaswal Fashions in Leicester had told him to expect a salary of as little as £3.50 an hour - but the minimum wage for someone over 25 is £8.72.

While there he saw clothing by Boohoo and Nasty Gal – a brand also owned by the fashion retailer – packed into boxes.

Over £1 billion has been wiped from its share value in the past two days as major fashion brands ditch the company.

A spokesman for Next said the fashion giant stopped selling items from Boohoo brands last week after campaign group Labour Behind The Label first raised concerns.

The spokesman said: "Next concluded there is a case for Boohoo Group to answer.

"Next needs to prove to itself the two Boohoo Group labels that it was stocking are being sourced in a manner that is appropriate and acceptable to Next.

"Next therefore has its own investigation under way to ascertain whether they are being made in a way that Next does not approve of."

On this, Boohoo declined to comment.

The company’s board said it was "shocked and appalled" by the allegations, however Boohoo refute suggestions the company was part of the company’s core supply chain.

A company spokesperson claims the clothes had been made in Morocco and were only being repackaged in Leicester at a premises formerly operated by Jaswal Fashions.

"Our investigation to date has not found evidence of suppliers paying workers £3.50 per hour," they said.

The company added, however, that it had found areas where the suppliers did not comply with Boohoo's code of conduct and cut them off.

Chief executive, John Lyttle, said: "As a board we are deeply shocked by the recent allegations about the Leicester garment industry.

"We wish to reiterate how seriously we are taking these matters and we will not hesitate to terminate any relationships where non-compliance with our Code of Conduct is found."