Embattled fashion brand Quiz has said it is “extremely concerned” by reporting over the weekend that alleged workers at a factory making its products in Leicester were not paid the National Living Wage.

Quiz said it “is currently investigating the reported allegations” raised by The Times and blamed a supplier sub-contractor “in direct contravention of a previous instruction”, which it has since suspended activity with.

The retailer said that all suppliers “must comply with the group’s ethical code of practice” and that relationships with any suppliers who don’t meet this standard “will be terminated”.

The Times found that workers at a factory producing garments for Quiz were offered as little as £3 an hour for their work.

The brand said that, in addition to the action already taken in regard to the incident, its board had committed to a full review of its current supply chain auditing process to “ensure [it is] robust enough to ensure ongoing compliance with our ethical code of practice”.

“We are extremely concerned and disappointed to be informed of the alleged breach of National Living Wage requirements in a factory making Quiz products. The alleged breaches to both the law and Quiz’s ethical code of practice are totally unacceptable.

“We are thoroughly investigating this incident and will also conduct a fuller review of our supplier auditing processes to ensure that they are robust. We will update our stakeholders in due course.”

Pay and working conditions in Leicester factories have become the centre of a scandal since a Sunday Times investigation uncovered illegal practices at a factory producing Boohoo products.