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A car wash at a Tesco store was found using undocumented Romanian workers who were paid half the minimum wage.

The premises in Congleton, Cheshire, was operated by Waves Car Wash, which manages about 180 Tesco car washes. Waves said it closed the franchise in June after a police raid found workers were earning £3.63 an hour – the hourly UK minimum wage for over-25s is £7.20.

A spokesman for Tesco said it was “pleased that Waves took immediate action to terminate the operation”. He added: “Waves work closely with legal authorities to ensure full checks of workers and ensure decent treatment – and their operation is regarded as industry-leading by independent labour experts.

“It is very disappointing that, on this occasion, the stringent procedures we agreed with them appear not to have been followed by the franchisee holder at this site.”

Joanna Graham, the company’s managing director, said: “All of our franchisees have to follow the same rigorous employment practices to ensure the legal and ethical treatment of every single worker.

“As soon as we became aware of the situation in Congleton, we took swift action to investigate and then terminate the agreement with the franchisee.

“We have a strict vetting process in place for all franchisees, followed by a programme of regular training and robust audits.”

The car wash was visited by police while the BBC Inside out programme was filming the Cheshire force conducting modern slavery raids.

The owner of another car wash in Northwich, run by a separate firm, was fined £30,000 after he was found on the same day to be hiring three asylum seekers.

Under UK law, asylum seekers are not allowed to work while their application is being considered, unless there are exceptional circumstances. Employees at both car washes said they did not feel coerced to work and Cheshire Police brought no criminal charges against the two operations.

A Cheshire Police spokeswoman said the scale of labour exploitation was “not known.Operations such as this… [help us] understand better the true extent of the issue.”

Dawn Frazer, managing director at the Car Wash Advisory Service (CWAS), said the use of underpaid workers in the industry was a “huge problem”, adding “the majority exploit staff by paying well under the minimum wage”.

About 1,000 car wash premises have registered with CWAS but Ms Frazer believes there are about 19,000 “unregulated car washes” and has called on authorities to “make test cases” of those exploiting workers.

“There are government regulations but nobody is enforcing them… It’s an absolute disgrace in this day and age that this is allowed to happen.”

A Home Office spokeswoman said the government would “not tolerate” exploitation.

“We urge anyone who has concerns about the treatment of workers in car washes or other businesses to report these concerns to the police so that victims can be helped and offenders brought to justice.”

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