Sports Direct: Mike Ashley In The Spotlight

We have all heard plenty of dark tales in the press about working conditions at Sports Direct – particularly the warehouse in Shirebrook, Derbyshire, which some workers have described as “the gulag” (i.e. a Stalin-era forced labour camp).

The Guardian last year reported that staff would be docked 15 minutes’ pay if they clocked in a minute late, and that there were lengthy security checks at the exits (as staff had clocked out, they were not paid for the time it took). The report also described a draconian ‘6 strikes and you’re out’ system which saw staff get a strike for, among other things, taking too long in the toilets. Receiving 6 strikes in any rolling 6 month period gets you dismissed.

The media was watching, then, when Mike Ashley, the company’s well-known founder and chairman, took to the microphone to answer MP’s questions about the allegations (particularly given that he had insisted he would not attend the hearing until the day before).

Before the main event, we heard from representatives of Unite the union and the two agencies from which Sports Direct obtains its warehouse staff – Transline and Best Connection.

Unite spoke of a “culture of fear” in the warehouse which caused staff to turn up to work when they were too ill to be there (reported sickness absences being a strike, naturally). Unite pointed to 110 ambulance call-outs to the site over two years, including one occasion when a female worker had given birth in the toilets (presumably thereby earning a strike for taking too long in the toilet). They had also heard reports of some female workers being coerced into sexual relationships by management.

We also heard from the union that some staff were being paid their wages on pre-paid bank cards, which cost the worker money to be set up and administered, and would charge them each time they withdrew their own earnings.

Transline and Best Connection were next to speak. They insisted that the ‘6 strikes’ system was in place to ensure staff safety, hence why ‘working without safety equipment’ earns workers a strike (though one might question how the toilet rule, “excessive chatting” and “wearing branded goods” fit that explanation).

Transline, the company which offers the pre-paid cards, insisted that they were not compulsory and entailed lots of benefits to those who use them. Both companies denied that workers are being mistreated, Transline in particular pointing to an online survey which indicated that 96% of workers are happy (despite only 45 of around 2,000 staff responding).

The biggest surprise of the day was Mike Ashley. Ashley conceded that there were problems with the time it took to pass through security but insisted that, whilst staff are still not paid for time spent in security checks, the bottlenecking issue was now resolved. He agreed that docking 15 minutes’ pay for 1 minutes’ lateness was “unacceptable” and admitted that the company is being investigated by HMRC for underpaying the national minimum wage.

Ashley agreed that “Sports Direct, if it is abusing things, deserves the cane”. He agreed to review the use of the ‘6 strikes’ policy. He expressed the view that, as permanent staff deliver a better service than those on temporary contracts, Sports Direct would try to move more of its workers into full-time employment. That said, Ashley insisted that the rise of online shopping means that Sports Direct has to engage agencies and the company does not have the expertise to hire “swathes” of permanent employees.

In addition to these admissions, Ashley seemed to lament that his company has outgrown him and that the reports had contained some “unpleasant surprises” for him. It was on that basis that he asserted that he was not aware of many of the reported problems in the warehouse. This took some of the shine from the earlier admissions, as Ashley was essentially disagreeing with questionable working practices in the abstract but not admitting that the majority of them happen at Sports Direct specifically.

All things considered, it seems clear that there were, and are, some concerning employment practices at Sports Direct’s warehouse and outlets which warrant urgent review. Ashley has promised that this will happen, but we should not get too excited – as Ashley said of himself, “I am not Father Christmas, I am not there to make the world wonderful”.

Sarah Owbridge is a paralegal at leading senior executive employment law firm BDBF.