Employment practices at Sports Direct Contents

1Introduction

1.Sports Direct International plc is the largest sporting retailer in the United Kingdom, with around 465 stores. Its headquarters and warehouse are in Shirebrook, Derbyshire, where there are 200 permanent employees, and over 3,000 agency workers, employed through two agencies, The Best Connection and Transline Group.

2.Our inquiry began as a result of select committee and media coverage on the working practices at Sports Direct. The Scottish Affairs Committee took evidence on employment practices at Sports Direct and the sale of the clothing company USC in March 2015.1 In April 2015, the Channel 4 Dispatches documentary claimed that Shirebrook operated as a sweatshop, with Victorian working conditions.2 The BBC’s “Inside Out” programme on working practices at the Sports Direct warehouse at Shirebrook was broadcast in October 2015, and through a Freedom of Information request, the BBC found that between January 2013 and December 2014, 76 ambulances or paramedic cars were sent to the postcode of Sports Direct’s distribution centre at Shirebrook.3

3.The Guardian carried out an investigation in December 2015, describing working practices at Shirebrook, which included: breaches of health and safety safeguards; the penalising of workers for breaking certain minor rules (and dismissing them if they committed six breaches of those rules within six months)—the so-called “six strikes and you’re out” policy; and making workers wait, unpaid, for a security check at the end of shifts, which brought their earnings below the minimum wage (resulting in a rate of about £6.50 an hour against the then minimum rate of £6.70 an hour for workers aged 21 or over). 4

4.Mr Ashley announced a review of working practices at Sports Direct on 18 December 2015, and stated that he would personally lead the review of all agency staff’s terms and conditions.5 In January 2016, we decided to hold a one-off oral evidence session on the working practices at Sports Direct, to hear about progress of the review and to listen to evidence ourselves from all sides about conditions in the shops and warehouse at Shirebrook. This we viewed as a precursor to a broader inquiry into the labour market.

5.We heard oral evidence from: Unite the Union; representatives from the two agency companies that provide agency workers to the warehouse; and Mr Ashley. We received written evidence from Unite the Union, the Gangmasters Licensing Authority, Transline Group, and Bolsover District Council, and supplementary evidence from The Best Connection and Mr Ashley.

6.Finally, we heard first-hand about the experiences of past and present workers at the Sports Direct warehouse and shops. We would like to thank all those who helped us with this inquiry, especially those who shared their personal experiences of working for Sports Direct. Michael Ford QC gave us legal advice on agency workers and workers on zero-hours contracts, and we thank him for his expert help.6

7.Our inquiry was hampered by Mr Ashley’s reluctance to appear before the Committee. We first decided to invite Mr Ashley to give evidence to the Committee in January 2016, and informal discussions took place between staff of the Committee and Sports Direct regarding an evidence session. An invitation was made by Mr Ashley to the Committee to visit him at the Shirebrook site, an invitation that had already been extended to local Members of Parliament.

8.We considered this invitation, but declined it in the interests of our commitment to transparency and in accordance with normal select committee practice of holding evidence sessions in public. Instead, several alternative dates were offered to Mr Ashley for him to give evidence to the Committee. Instead of engaging constructively he chose to engage in lengthy written correspondence regarding the powers of the Committee to secure his attendance.7 Similarly, the Committee invited representatives of the two agencies to attend (in March 2016), and heard nothing from them until Thursday 2 June 2016, five days before the oral evidence session, when they agreed to give evidence (although Transline’s two CEOs did not attend, but put forward their Managing Director and Finance Officer instead).

9.When Mr Ashley finally decided to appear before the Committee (informing the Committee two days before), we had a very constructive exchange of views, which has resulted in welcome commitments by Mr Ashley to achieve real change. If he had agreed to come when we originally asked him, five months ago, he could have improved the conditions sooner, conditions that he found so abhorrent. Mr Ashley told us that “one of the reasons I agreed to come—whether or not I think I ought to or not is a different subject—is to make a difference”.8 The delay was unfortunate and unnecessary.


3 BBC Inside Out programme, 5 October 2015

6 Michael Ford QC, Old Square Chambers, and Professor of Law, University of Bristol Law School

7Attendance at Select Committee”, Mr Wright to Mr Ashley, 26 May 2016 and “NOTHING TO HIDE”, Mr Ashley to Mr Wright, 5 June 2016

8 Q235




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21 July 2016