• Video report by ITV News Business Correspondent Jo Partridge

House of Fraser has apologised to customers after cancelling all orders placed online.

The beleaguered retailer, said it had wiped all orders that had not already been sent to customers and would be issuing refunds.

The move comes after the chain’s website was taken offline amid complaints from customers about delayed deliveries since Mike Ashley's Sports Direct struck a deal to acquire the company.

The issue reportedly stemmed from a dispute involving employees at a key warehouse.

House of Fraser said on Thursday that it had seen “significant delays” with delivering online orders.

What is the customer backlash?

Mike Ashley's Sports Direct made a bid for House of Fraser hours after it fell into administration. Credit: PA

The announcement was met with dismay by some some customers who had placed orders online, some several days ago.

One said on Twitter: “Absolutely disgraceful. Ordered a £90 purse last Thursday. Yes a week ago for my daughters birthday. Not 1 email concerning delivery or info and now order cancelled and you say email in a few days!!! Get my money back ASAP”

Another said they had been told by email that items from their husband’s suit would not be delivered.

They tweeted: “This was for our holidays! I don’t have time to go back to Edinburgh with the trousers which are now totally useless! What do you suggest I do!”

A message posted on the retailer’s website said it was “working hard to make some improvements”, telling customers it will be “back up and running as soon as possible”.

What rights do shoppers have in seeking refunds?

Mike Ashley has vowed to turn House of Fraser into the 'Harrods of the high street'. Credit: PA

Under the Consumer Rights act, customers should get a refund within 14 days of either the trader getting the goods back, or the customer providing evidence of having returned the goods.

A deduction may be made by the trader if the goods are devalued as a result of them being handled by the customer.

Under House of Fraser's own returns policy, if items are bought in-store you can return the item within 14 days for a full refund regardless of whether it's damaged or not.

If items are returned outside the 14 day period but within 28 days, you are entitled to exchange the item or be refunded with a gift card.

It is not currently possible to view the House of Fraser returns policy on the website. Credit: House of Fraser

For online purchases items can be returned in-store or to a House of Fraser return centre within 28 days of your order for a full refund. Returns after that period but within 35 days should be refunded with a House of Fraser voucher.

Despite the Consumer Rights act and House of Fraser's own returns policy, the right of customers to receive a refund lies in a grey area.

As the takeover is not complete, neither Sports Direct or House of Fraser have published a policy for returns during the period in which the company changes hands.

Even when the Sports Direct deal is complete, because House of Fraser fell into administration, the new owners are under no obligation to honour any refunds.

While it would be a positive PR move for House of Fraser's new owners to honour refunds, it may not be financially viable.

What exactly have House of Fraser said in response?

“We have taken the decision to cancel and refund all orders that have not already been sent to customers,” the department store said on Facebook.

“We didn’t take this decision lightly, but since we cannot give our customers clear assurances of when their orders will be delivered, we believe cancellation is the best option.

“All customers affected will receive an email about the cancellation and refund in the next couple of days.

“Please accept our apologies for any inconvenience caused and thank you from everyone at House of Fraser for your patience at this time.”

It came as The Times reported employees at a key warehouse supplying products to House of Fraser stores and online shoppers had downed tools in a wrangle over delivery payment terms with Sports Direct.

Why have workers reportedly downed tools?

The paper said it understood workers at the chain’s distribution centre in Wellingborough had been told by XPO Logistics, which operates the site, to stop accepting goods and processing deliveries, leading to product shortages in some House of Fraser outlets.

Sports Direct owner Mike Ashley said his ambition was to turn the department store into the “Harrods of the high street” after striking a deal with administrators earlier this month.

The £90 million rescue bid saw Sports Direct acquire all 59 House of Fraser stores, the brand and all of the retailer’s stock.