A popular retail clothing chain has agreed to pay more than 1,000 current and former employees $1.4 million in unpaid wages and overtime, the state attorney general announced yesterday.

Yellow Rat Bastard, which opened its first store in Manhattan’s SoHo neighborhood and specializes in street-style fashion, and affiliated stores paid employees as low as $5.25 an hour and failed to pay them overtime, the attorney general, Andrew Cuomo, said. The state’s minimum wage is $7.15 an hour. Overtime pay is one and a half times an employee’s regular hourly pay after 40 hours a week. The chain also retaliated against employees believed to be cooperating with investigators by reducing their work hours and even firing them illegally, Cuomo’s office said.

“Any retail employers taking advantage of hardworking New Yorkers are on notice: Refusing wages and paying below the minimum wage will not be tolerated in New York,” Mr. Cuomo said in a statement. “Denying dignity, respect, and fairness in the workplace is both unethical and unlawful.”

The president of the Retail, Wholesale, and Department Store Union, Stuart Appelbaum, which represents American and Canadian workers and helped in the investigation, said, “New York retail workers have been pushed around in this city long enough; today we’re pushing back.”