Cotton On, the clothing firm based in Victoria, has paid back about $300,000 to thousands of workers that have been underpaid.

The clothing retailer has repaid 3289 workers the $278,000 it owed to employees for going to training programs outside of official work hours from the February to December 2008 time period.

The payments that averaged $84.56 for each worker are answer to the findings of the Fair Work Ombudsman, which found that Cotton On had not followed workplace laws.

The payments were voluntarily repaid by the clothing company, and under conditions signed with the Ombudsman, Cotton On also apologized to its workers.

As part of the conditions, the company's human resources administrators must go into training regarding workplace relations compliance.

Cotton On must also file a detailed report to the Fair Work Ombudsman yearly for the following three years as proof that it is appropriately paying its staff.

The conditions imposed by the Ombudsman are part of the deal referred to as "enforceable undertaking", which lets the company avoid heavy penalties in civil court proceedings.

In Cotton On's public apology to its employees, the company "expresses its sincere regret and apologises to all past and present employees for failing to comply with its lawful obligations" and further promises that such conduct from the firm "will not occur again".