Harrods allocates £60m for abuse victims as store records loss

Over 100 employees of the luxury department store are expected to claim up to £385,000 through the redress scheme, which remains open until March 2026.

The scheme was established to compensate victims who say they suffered abuse by former Harrods owner Mohamed Al Fayed, who passed away in 2023.

Numerous women accused Al Fayed, who owned the luxury store from 1985 to 2010, of rape and sexual assault. The Metropolitan Police saidt 146 people have come forward to report a crime in their investigation into Al Fayed.

Harrods has allocated £57m to be used to compensate alleged victims, with an additional £5.3m reserved to cover legal and administrative costs, bringing the total amount allocated to £62.3m.

Harrods managing director Michael Ward said that “more than 100 survivors” have joined the process of the scheme since it was opened.

“Compensation awards and interim payments began being issued to eligible survivors at the end of April 2025, and the scheme will remain open until March 31, 2026,” he said. 

The compensation scheme will award each eligible claimant general damages of £200,000. They could receive up to £385,000 in compensation, plus treatment costs, if they agree to be assessed by a consultant psychiatrist, or up to £150,000 without a medical assessment. 

In a statement announcing the scheme, Harrods said: “While we cannot undo the past, we have been determined to do the right thing as an organisation, driven by the values we hold today, whilst ensuring that such behaviour can never be repeated in the future.”

To be eligible for the scheme, claimants must prove that they were subject to sexual assault and/or wrongful testing, and prove that Harrods is liable.

Many of those who say Al Fayed abused them underwent intrusive medical examinations when they were hired. In accepting a compensation offer, victims will waive their right to pursue further action for damages.

Financial performance 

Partly due to the scheme, Harrods recorded a loss of £36.5m after tax in its latest full year accounts, compared with a profit of £111m the previous year. The loss before tax stood at £34.3m.

Gross transaction value excluding VAT fell 2.4% to £2,198.0m. 

Turnover rose 0.6% to £1,081.7m for the financial year 2024, operating profit before exceptional items fell 17% to £177.7m, down from £213.9m in 2023, which the department store said reflected ongoing investment in employee salaries and increased distribution costs.

Ward said significant exceptional costs impacted the year’s results, including the strategic digital transformation of the enterprise resource planning system and the provision for redress and associated costs for abuse survivors. 

He added that 2024 was “a year of stable trade for Harrods” with results demonstrating “outperformance by Harrods of the luxury industry as a whole” despite challenging trading conditions in the luxury sector.

The company continued investment in its Knightsbridge store, including the redevelopment of womenswear and renovation of The Georgian restaurant.

Ward said: “The current domestic and global economic environment means that current trading conditions in the luxury sector remain challenging.

“However, we remain confident in the strength of the business, and the resilience of the luxury sector, and that we will continue to drive progress towards longer-term growth and performance objectives.”