Sports Direct staff 'not treated as humans', says MPs' report

MPs have accused one of Europe's biggest retailers of not treating its workers like humans.

A report by the Business, Innovation and Skills committee states Sports Direct founder Mike Ashley must be held accountable for company failings.

Evidence suggested Sports Direct's working practices were similar to those of a Victorian workhouse, one MP said.

In response, Sports Direct said in a statement that its policy is to treat all people "with dignity and respect".

It comes after Mr Ashley recently told MPs the firm was being investigated over staff being paid below the minimum wage.

Union officials told MPs that in one case an employee had given birth in a toilet at the company's warehouse base in Shirebrook, Derbyshire, because she feared losing her job if she called in sick.

Allegations also surfaced of some workers being promised permanent contracts in exchange for sexual favours.Committee chairman Iain Wright said evidence heard last month by MPs suggested Sports Direct's working practices "are closer to that of a Victorian workhouse than that of a modern, reputable High Street retailer".

"It's seems incredible that Mike Ashley, who visits the warehouse at least once a week, was unaware of these appalling practices," Mr Wright said.

"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.

"Mike Ashley had to be brought kicking and screaming to answer the committee's questions.

"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."

The committee said it would visit the firm's base in Shirebrook, Derbyshire, and "continue to hold Mr Ashley's feet to the fire".

That representatives of Sports Direct's agencies - Transline Group and The Best Connection, who are paid £50m a year by the firm - gave "woefully poor, and in some cases, incorrect, evidence"
It is believed Transline "deliberately misled the committee in their evidence", which could be considered contempt of Parliament
The agencies' six strikes policy - whereby an employee is dismissed if they receive six strikes - "gives the management unreasonable and excessive powers to discipline or dismiss at will"
The way the business model is operated involves treating workers "as commodities rather than as human beings"
There are still unanswered questions over when back pay will be received
The practice of deducting 15 minutes of pay for clocking in one minute late on arrival, or on return from a break, has been changed. Now, the system rounds up in segments of five minutes, for example, if a person is four minutes late, they will lose five minutes of pay. However, the committee said this still seems "ungenerous" and recommended Mr Ashley considers rounding down, so a person is not punished if they are four minutes or less late
Transline made claims which were later refuted by the Gangmasters Licensing Authority, casting "doubt on the probity of Transline and on the reliability of their witnesses"
Mr Ashley and the agencies should review the health and safety provisions in the warehouse and report back to the committee. Bolsover District Council and the Health and Safety Executive have also been encouraged to "take a more active role" in overseeing provisions are being adhered to
Mr Ashley should lead a review into his corporate governance arrangements to improve the running and reputation of the company

Mr Ashley gave evidence to MPs following a Guardian report last year that workers at the warehouse had been subjected to rigorous searches and surveillance, leading to staff receiving less than the minimum wage.

A BBC investigation also found ambulances had been called to the sportswear retailer's base 76 times in two years.In a letter to MPs on 12 July, Mr Ashley said work had begun on a review into working practices and a written update would be ready in 90 days.

The Newcastle United owner said he had contacted union Unite "with a view to opening a constructive dialogue".

Mr Ashley confirmed all workers - permanent and agency staff - were now paid above the National Minimum Wage (NMW), but said these pay rises were not "back pay" - which relates to HMRC's investigation.

Analysis: Sarah Sturdey, BBC current affairs reporter

The select committee has pulled no punches with its strong criticism of how one of the largest warehousing operations in Europe is run by Sports Direct at Shirebrook, treating staff as "commodities" not human beings. The working practices are described as deeply disturbing.

The relationship between Sports Direct and the two agencies supplying more than 3,000 workers comes across as a marriage, but one which might not even be necessary.

There's a dominant spouse, with a "strong grip", that's the giant sports retailer and its founder Mr Ashley, and a compliant other half, the two agencies, Transline and The Best Connection, joined in matrimony with him indoors by a £50m contract.

But the head of the household clasping the purse strings doesn't apparently seem to know or understand what's really going on with its day-to-day running.

The committee has made it plain, if he really doesn't, he should.

So where does this leave working conditions at Shirebrook?

Mike Ashley said in his letter to the committee on 12 July there's a review of working practices by RPC solicitors, the company's independent legal advisors.

The committee wants the local health and safety enforcement authority for retail warehousing - Bolsover District Council - and the Health and Safety Executive to step up and is critical of the lack of preventative steps by the council to reduce the number of accidents. Is this too big a job for a local district authority?

A HMRC spokesman said individual cases were not discussed but "we always investigate businesses where we believe the NMW is not being paid".

Sports Direct said in a statement: "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."

Transline Group said in a statement: "Transline representatives attended the committee to give a transparent account of our operations at Shirebrook.

"No incorrect or misleading information was given, and we will respond to the committee on any and all issues raised within the report within the two-week deadline stipulated.

"Transline remains committed to ensuring a safe working environment and fulfilling its duty of care to our employees."

Bolsover District Council was unavailable for comment when contacted by the BBC, and The Best Connection declined to comment.