A BBC Panorama programme aired last night has exposed how a Scottish marketing company used by the British Red Cross exploited an employment loophole to pay street fundraisers below the minimum wage.

Glasgow-based Smiths Marketing Associates were hiring people on a self-employed contract where they were only paid commission. This meant that fundraisers could be taking home less than the national minimum wage.

Matthew Parkes, a graduate who worked for Smiths Marketing Associates told Panorama that he had been working 70-hour weeks and earning around £200 pounds, averaging out at £2.85 per hour.

Under-cover filming of the interview process also showed the interviewer being vague about the salary and the interviewee being asked to undertake a day's unpaid work for the company.

Red Cross responds

Mark Astarita, director of fundraising at the British Red Cross, said: “We are concerned by the material which has emerged and we are thoroughly investigating why Smiths Marketing Associates did not give greater clarity from the outset.”

He added: “We expect all the agencies we work with to be transparent at all times in their recruitment processes and are very grateful to the BBC for bringing the issue to our attention.”

The British Red Cross said that it uses multiple agencies for doorstep and street fundraising including Smiths.

Last April the Advertising Standards Authority upheld a complaint against Smiths Marketing Associates about a job advert for trainee marketing positions because the listing did not make it clear that it was a self-employed opportunity.

This morning Smiths' own website was unavailable but it is still possible to apply for self-employed trainee marketing roles through various job sites.

Smiths Marketing Associates refused to comment on the issues raised or whether it had changed any of their processes.