According to a report released today, Sports Direct will offer staff a contract guaranteeing them at least 12 hours work a week. Founder Mike Ashley has 55 percent of the company’s shares, and holds the position of deputy executive chairman.
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Sports Direct has apologised for “serious shortcomings identified in working practices” at its Shirebrook warehouse, following publication of a report into its working practices by Reynolds Porter Chamberlain, who are legal advisers to the company.
The draconian regime at Shirebrook, where most workers are employed via agencies on zero-hour contracts, first came to light after an undercover investigation by the Guardian nine months ago.
It will also ensure staff are paid above the national minimum wage, as the previous breach of the minimum wage regulations in the warehouse was “unacceptable but unintentional”, the reported concluded.
The Sports Direct report states that Mike Ashley “takes ultimate responsibility for any aspects of working practices that were unsatisfactory”.
He said allegations that the company’s staff were subject to “Victorian” working practices and lived in constant fear of losing their job or facing disciplinary action for “excessive” talking or spending too long in the toilet were “not acceptable”.
He added that the retailer was employing a full-time nurse and a welfare officer, and will aim to improve upon the systems that already exist.
City institutions such as Legal & General Investment Management and Aviva Investors have publicly voiced concerns about Sports Direct’s corporate governance after a string of issues, with several ready to oppose Hellawell and other board members’ re-election at today’s annual meeting.
Euan Stirling, fund manager at Standard Life, which owns 5.8pc, said a “full and independent review of governance at the company is required”.
Confirmation that the company had failed to do enough for some investors came initially from Standard Life Investments – its second-largest shareholder.
Billionaire Sports Direct boss Mike Ashley was left red-faced after emptying wads of £50 notes from his pockets during a warehouse tour.
Despite this, Sports Direct said it rejected an offer by Hellawell to resign, and with Ashley owning a controlling stake, he prevailed over minority investors.
Founded in 1982 on a quiet road in southeast England, Sports Direct has grown into a major force on British shopping streets, with discount offers luring shoppers into its 450 stores.
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During a tour of the company’s Shirebrook warehouse, Mr Ashley said he did not “knowingly” or “deliberately” run the operation badly, adding that the firm’s rapid growth and the sheer scale of the business had made it hard to get it right.
