A former Poundland worker has won her claim that the government’s back-to-work scheme which required her to work at the value retailer for free breached forced labour laws.

The Court of Appeal today agreed with university graduate Cait Reilly, 24, who was made to work at Poundland unpaid or risk losing her weekly jobseeker’s allowance.

Judges quashed the regulations underpinning the work schemes, however the government said it was seeking permission to appeal to the Supreme Court.

The Department for Work and Pensions issued fresh regulations this morning that would abide by the new judgment.

Poundland chief executive Jim McCarthy said: “Poundland recognises the importance of offering work experience to people looking to get back into work. We have been working in partnership with the Job Centre Plus over the last few months to launch our own work experience programme for those considering a career in retail.

“Our work experience programme is completely voluntary – no one has their benefits taken away from them at any point during the process. This programme replaces any involvement with the Department of Work and Pensions prime providers and their work experience schemes.”

Many retailers including Sainsbury’s, TK Maxx and Poundland, withdrew from the controversial Get Britain Working scheme after Reilly’s case caused uproar last year.