The employees told Swedish news outlet Aftonbladet, in a report published on 12 December, that Djerf belittled them, called them names and yelled at them at work.
Other claims included that Djerf told some models they didn’t fill out a pair of jeans, called others fat, and that she forced one employee to scrub a toilet.
Djerf Avenue’s website claims that the brand promotes a world “filled with kindness, inspiration, and respect”.
"Business founders and entrepreneurs are great at coming up with innovative ideas and developing products,” Simon Jones, director of HR consultancy Ariadne Associates, told HR magazine.
“But they aren't necessarily skilled in all the aspects of running a business, particularly when it comes to managing people.”
On 17 December Djerf published an apology statement on Instagram that said she “wasn’t ready” to be a leader of the brand.
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“When I started Djerf Avenue I never expected that the company would be what it is today, with so many team members and so much responsibility,” Djerf said the statement.
"I'll keep learning and working to ensure Djerf Avenue is a safe, inclusive space for everyone."
Djerf launched the brand in 2019; last year the brand made £27.5m in revenue.
Founder-led businesses can often face HR risks, Natalie Ellis, founder of HR consultancy Rebox HR, commented.
Speaking to HR magazine, she said: “The key risks include: an informal leadership approach; power dynamics and a lack of structured HR processes.
“Inexperienced founders may blur professional boundaries, leading to inappropriate workplace behaviours.
“Founders typically have outsized influence, which can create an environment where employees feel unable to challenge inappropriate behaviour or raise concerns without fear of repercussions.
“Without robust HR policies and procedures, companies risk creating toxic workplace cultures that can lead to legal challenges, reputational damage, and high staff turnover.”
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Founder-led companies should ensure they hire employees who have skills aligned to their goals to avoid similar claims, Michelle Plaisted, chief people officer at a financial services start up currently in stealth mode, commented.
Speaking to HR magazine, she said: “The key to avoiding this is to hire people with the right skill sets that match business requirements, setting clear goals and responsibilities, not micromanaging and creating open and honest communication to establish a culture of trust and psychological safety.”
Hiring an external HR consultant could help manage founders lead their people, Jones suggested.
He noted: “No start-up would seek to grow without financial advice and they should take the same approach to staff – getting in external HR advisers who can support them when needed.”
HR could provide training and feedback mechanisms to prevent allegations such as these from arising, Plaisted continued.
She added: “It’s not HR’s responsibility to police behaviours but we can promote and share core values to guide behaviour and encourage founders to demonstrate respect, empathy, and transparency in their interactions.
“Ensure that training requirements are identified and supported and that feedback mechanisms are in place such as employee engagement surveys to identify and address any concerns.”
Djerf Avenue was contacted for comment.