(Bloomberg) -- A unit of troubled German financier Lars Windhorst’s luxury lingerie firm La Perla stopped paying the salaries of two directors in the UK late last year, with one of them alleging that the lack of income had caused “stress and disaster” to their lives.

Pamela Reynolds, still employed by La Perla, said in court documents for a London employment tribunal that the effect on her life had been “devastating.”  

“I haven’t been able to pay my mortgage, go home and see my parents, go out of my house,” she said in the filings prepared for a hearing on Wednesday. The directors sued the firm for their unpaid wages.

One of the most controversial figures in European finance, Windhorst and his companies have faced a series of financial and legal woes over the past months. Last November, a London judge ordered the shuttering of the UK unit of La Perla over £2.8 million ($3.5 million) worth of unpaid tax debts and a petition from His Majesty’s Revenue & Customs.

Over the last year or so, Windhorst or his companies have also been dragged to UK courts by a Norwegian shipping magnate, the majority owner of a German arms manufacturer and a brokerage based in the United Arab Emirates.

The knock-on affects of these woes were laid out in the London court on Wednesday as the two directors sought to claw back their earnings. They won their suit, with Judge Mark Emory ruling that Reynolds and the other ex-employee, Caroline Connor, were owed £94,300 ($117,600) and £28,800 ($35,900) respectively.

There has “only been one month in the whole period” of her employment since April 2020 that Reynolds said she was paid on time. Since September 2023, she has not been paid at all. 

Judge Emory said on Wednesday he was “surprised” that La Perla had not dismissed Reynolds despite being unable to pay her wages and the lack of work. 

Communication from management was sparse, but executives would tell employees to “hold tight” as funding was coming, according to Reynolds.

Connor, who said she was headhunted by La Perla recruiters and joined in August 2023, had not been paid by La Perla since October 2023. She said it was “shocking” to hear that by the time she was approached by recruiters in late 2022, Reynolds had not been being paid on time. “I don’t know why they were even recruiting if they were in such a bad position in the first place,” she told the judge.

Connor said she had raised a grievance in December but was told by the company that it would be pointless to escalate the situation further because “there’s no money in the pot.” 

That was when she resigned and started job-hunting. “By this point I have family to pay for, mortgage payments, I just need to start earning and actually getting paid as quickly as possible,” she told the judge. 

Last July, Windhorst told a London court he wasn’t sure what his net worth was. “It is a complex question” the financier told the judge. When asked whether he was solvent, he said it was “a difficult question to answer.”

Spokespeople for La Perla didn’t respond to requests for comment. Windhorst declined to comment when contacted by phone.

--With assistance from Lucca de Paoli.

©2024 Bloomberg L.P.