Ted Baker’s share price fell sharply on Monday as the company set up a committee of directors to consider the findings of an investigation into staff complaints about the behaviour of its founder, Ray Kelvin.

Shares in clothing retailer sank nearly 13% in early trading after more than 60 current or former staff came forward to the employee campaigning platform Organise with complaints about Kelvin’s alleged behaviour, including kissing ears and giving unwanted hugs and shoulder massages, as reported by the Observer at the weekend.

A petition hosted by Organise had gained more than 2,500 signatures on Monday. The number of signatures from former and current staff is understood to have risen from 200 to 300 since Friday.

Ted Baker said on Monday it had set up an independent committee of non-executive directors to consider the findings of an independent investigation into staff complaints of “forced hugs” and alleged harassment by Kelvin.

The company said: “Ray, and the company’s leadership, have always prided themselves on Ted Baker being a great employer and business to work with. Accordingly, they and the board take these concerns very seriously and the board has directed a thorough and urgent independent external investigation is carried out into these matters.”

It said the committee would ensure that the “views and concerns” that emerged from the investigation were “recognised and carefully considered and that appropriate responses are taken forward”.

One former junior employee, who left the company earlier this year, said they had been hugged by Kelvin several times and also had their shoulders massaged by him in front of a group of visitors to head office.

“Everyone has a hug [from Kelvin], it is completely the norm. When you haven’t met Ray that sounds fine. But when you are a young man or girl and a mid-50s physically imposing guy points at you and tells everyone you are going to get a hug, that’s really embarrassing.

“It was never a hug like you or I would do with mates for one or two seconds. It was always noticeably too long.”

You were just “not allowed to” pull away, they added. “He [Kelvin] holds you in, he’s a big guy and it was my first job. I didn’t know where to fight my battles.”

Retail Week on Monday released excerpts of an interview with Kelvin in which he denied people had been coerced into sitting on his knee.

“What was acceptable in my life – and this is very important – stays with me,” he told the trade magazine, in comments recorded in the summer but released on Monday. “My father had lots of people sit on his knee because it was a friendly thing to do when I grew up.

“You can’t expect my life to change because today people are particular about certain things that we grew up quite naturally with. Eric and Ernie [Morecambe and Wise] went to bed together every single night and no one thought anything of it. That was proper, good old-fashioned stuff. Plenty of people might have sat on Ted Baker’s knee.”

Asked by Retail Week whether he believed his team could object to the internal culture at Ted Baker, Kelvin said: “I don’t know. We just do it. I don’t know if I ask them enough? If I asked them, would they say [anything] anyway? They probably wouldn’t want to be negative to me.”

The company is expected to put out a disappointing trading statement on Thursday.

However, more than one City analyst told the Guardian that the share price fall was connected to the weekend’s reports about Kelvin rather than any trading fears.

The company told the Observer that it was “in dialogue” with Organise in order to “understand the details and nature of the claims”.

It added: “Ray greets many people he meets with a hug – be it a shareholder, investor, supplier, partner, customer or colleague. Hugs have become part of Ted Baker’s culture, but are absolutely not insisted upon.”

Kelvin declined to comment.