Employment practices at Sports Direct Contents

4The Gangmasters Licensing Authority (GLA)

49.The Gangmasters Licensing Authority (GLA) is a non-departmental public body, established under the Gangmasters (Licensing) Act 2004, which regulates businesses that provide workers to the fresh produce supply chain and horticulture industry, to ensure legal employment standards are upheld. According to its website, it protects “vulnerable workers in UK food and drink processing and packaging, agriculture and shellfish gathering”.72 The GLA licensing standards cover health and safety, accommodation, pay, transport and training.73

50. We heard that part of the Transline Group, Qualitycourse Ltd, which supplied temporary workers to assemble pizzas for the retail sector, had their licence revoked by the Gangmasters Licensing Authority when they operated in the food industry.74 When questioned, Jennifer Hardy, Finance Director of Transline, told us it had not been revoked, but had lapsed:

We had an administrative error on our side, which led to us having to go through an application process for our licence. We actually only supplied one client, which is 0.8% of our business. During that process we no longer supplied that client.75

51.We asked the GLA to confirm this explanation. The GLA’s submission refuted Jenny Hardy’s claim:

This is not true. The company continued to supply workers to their client on various dates between 14 July 2013 and 19 September 2013 thus committing a criminal offence under s12 of the Gangmasters (Licensing) Act 2004. This offence carries a maximum penalty of 10 years imprisonment.

Unlicensed supply took place after the email of 1 August which not only confirmed that Qualitycourse held no valid licence but also warned that it would be an offence to provide labour in the GLA sector. The continued unlicensed trading sparked a criminal enquiry and under GLA published policy this takes precedence over the application process. As a result the application for the licence was suspended and the applicant informed of this by letter on 30 September 2013.

The GLA decided not to pursue this prosecution but the company did receive notification of the offence by way of a formal warning letter on 9 October 2013.76

52.In oral evidence, Jenny Hardy, from Transline, repeated her claim that “we removed ourselves from the process”.77 The GLA responded: “This is also categorically not true. The licence application proceeded to completion and it was refused by the GLA. At no point did Transline withdraw its application and thus [had not] ‘removed themselves from the process’”.78 Furthermore, the GLA carried out their inspection in September 2013, and Jennifer Hardy, who was in her post of Finance Officer at Transline at the time, was present for part of that inspection process.79 The GLA decided that it would not be in the public interest to pursue the prosecution but, as stated above, Transline received notification of the offence by a formal letter dated 9 October 2015. The letter states: “On this occasion, the GLA considers that the public interest would be satisfied by the administration of a warning rather than instituting criminal proceedings. Records held within the GLA will be noted in respect of this warning”.80

53.Written evidence from Transline, sent after the oral evidence session, reasserted the claim that they “began the process of applying for a new licence but then decided not to pursue it as we only had one client operating in the GLA sector, and were no longer supplying staff to clients in that sector. The decision was a straightforward commercial choice by us and nothing more”.81 The GLA again refuted this, stating that “this is not true—as stated previously, the reasons for the company not holding a GLA licence are numerous and set out in the decision letter detailing the failed Licensing Standards that resulted in the refusal”.82 The GLA provided detailed timelines and relevant documents to support their evidence.83

54.As a result of the Immigration Act 2016, the Gangmasters Licensing Authority will be reformed, and from October 2016 will become the Gangmasters and Labour Abuse Authority. Along with the change in name, it will have its remit extended and will have the capacity to study cases of labour abuse throughout the UK labour market, including retail. We welcome this change, which will give greater protection to all workers.

55.In both written and oral evidence, Transline made claims to us which were later refuted by detailed evidence from the Gangmasters Licensing Authority. This casts doubt on the probity of Transline and on the reliability of their witnesses. On the face of it, we believe that Transline deliberately misled the Committee in their evidence to us. In view of the seriousness of this action, which could be considered a contempt of Parliament, we invite Transline to respond, within two weeks of the date of this Report’s publication, to explain how their evidence was not deliberately misleading, before we consider what further steps to take.

56.The extended remit of the newly-named Gangmasters and Labour Abuse Authority, in October 2016, will include warehouses such as Shirebrook and retail outlets such as the Sports Direct shops. We recommend that the GLA seriously considers looking into employment practices at Sports Direct, both in the shops and in the warehouse, to ensure that they are compliant with the relevant legislation.

72 The Gangmasters Licensing Authority, accessed 19 July 2016

73 As above

74 Q24 [Steve Turner] Providing workers to perform roles in food processing requires a licence from the GLA.

75 Qq84–85

76 GLA, para 2

77 Q84

78 GLA, para 2

79 GLA Inspection report, inspection date September 2013, inspection report November 2013

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21 July 2016