In its scathing report of Sports Direct, the Business, Innovation and Skills committee has accused the sportswear retailer of treating its staff “as commodities rather than as human beings.”
The report found that billionaire founder Mike Ashley has built his success on a business model that uses “appalling working practices” and treats staff “without dignity or respect”.
Whistleblowers, the media and the trade union Unite all contributed evidence to the report, which revealed “extremely disturbing” working conditions and a “culture of fear” among workers.
One example told of an employee who gave birth in a toilet at the company’s Shirebrook warehouse because she was scared of losing her job if she called in sick.
It was also heard that some employees were promised permanent contracts in exchange for sexual favours.
In December 2015, two undercover Guardian reporters stated that the unpaid 15 minute checks workers were subjected to when leaving after a shift meant they were being paid less than the National Minimum Wage for the time spent at work.
A recent BBC investigation also found ambulances had been called out to the retailers base 76 times in two years.
Iain Wright, chairman of the committee, said:
“The evidence we heard points to a business whose working practices are closer to that of a Victorian workhouse than that of a modern, reputable high street retailer.”
Wright also stressed that, as the face of Sports Direct, Mike Ashley must be held accountable. He said:
“It seems incredible that Mike Ashley, who visits the Shirebrook warehouse at least once a week, was unaware of these appalling practices.
“This suggests Mr Ashley was turning a blind eye to conditions at Sports Direct in the interests of maximising profits, or that there are serious corporate governance failings which left him out of the loop in spite of all the evidence.
"To Mr Ashley's credit, when he gave evidence he was open and willing to engage and he is now setting out some of the steps which Sports Direct needs to take to stop these practices recurring."
A spokesman for Sports Direct said:
“We will study the contents of the committee’s report very carefully. It is our policy to treat all our people with dignity and respect.
“We are pleased to see that the committee has recognised Mike Ashley’s commitment to engage in addressing any shortcomings in the working practices at Sports Direct.”
The committee said it will visit the firm’s base to “continue to hold Mr Ashley’s feet to the fire.”
HMRC is carrying out an investigation into working practices at Sports Direct. It’s not known yet whether this will take into account prosecutions. HMRC also recently announced it will extend its inquiry into the non-payment of the minimum wage to include the retailer’s shop workers.Return to the blog archive »