Sports Direct Admit Errors

June 10, 2016, By

The founder of Sports Direct, Mike Ashley, was questioned earlier this month by a Government Select Committee, about his firm’s treatment of staff. Mr Ashley was facing the Committee after both the BBC and Guardian newspaper had compiled investigations in to Sports Direct’s working practices and policies.

When questioned, Mr Ashley, admitted that staff at one of its warehouses in Derbyshire had been paid below the minimum wage. Ashley blamed the firm’s rapid growth for its problems. He stated that the firm was now “too big” for him to know everything that happened. Ashley also explained to the Committee that an internal investigation had discovered some issues with its working practices that needed addressing. He went on to note that much of what he had discovered had been an “unpleasant surprise”.

Union officials have criticised Sports Direct for creating a culture of fear by operating a strike system for misdemeanours. After six strikes staff were dismissed. Union officials went on to explain that the staff at the Derbyshire distribution centre were given a strike for things like excessive chatting, taking a day off sick and for spending too much time on the toilet. Sports Direct have now pledged to implement a number of changes to working practices within ninety days. This includes moving more staff from zero hours contracts onto permanent ones. Investigations by HMRC into Sports Direct’s payment of minimum wage issues are however still on going.

The matter has received widespread media and political attention. David Cameron has publically criticised Sports Direct’s practices following its admissions. Similarly, Jeremy Corbyn described Ashley as a boss who “would make Scrooge look like a good employer”.

The above issues highlight the importance of implementing fair working practices and policies as well as compliance with the National Living/Minimum Wage rates of pay. If you or your company would like to discuss any of the above issues or would like further advice regarding your policies and procedures then contact our Employment team on 0161 672 1425