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Mike Ashley to review Sports Direct working conditions

The British billionaire and leisure-wear magnate will make sure Sports Direct not only meets legal obligations but also provides a good environment for the entire workforce, the company said.

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A resolution: Ashley’s review will start in the New Year

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Sports Direct’s (LON:SPD) majority owner Mike Ashley is to personally review the group’s controversial working conditions and employment terms for agency staff.

The British billionaire and leisure-wear magnate will make sure Sports Direct not only meets legal obligations but also provides a good environment for the entire workforce, the company said.

He is expected to begin this review in the New Year, it added.

The company this morning responded to the recent criticisms of its human resource practices, telling investors that without what it describes as “a performance-led culture” there would be no way it would have become the retailer that it is today.

It comes after high profile reports by The Guardian and BBC were critical of working practices and conditions at the group’s centralised warehouse operation in Shirebrook, in Derbyshire.

Whilst setting out what it said were key facts, today, the company said it hopes that unfounded criticisms of its business practices will cease.

“To date, Sports Direct has sought to address questions relating to its employment practices on a case-by-case basis directly with the enquirer, but it has become evident that by doing so various parties have chosen to ignore the facts provided and have continued to present an unfair portrayal of the company's employment practices,” it said in a statement.

“Sadly, it is also now clear that some others have chosen to rely on this portrayal when making public statements about Sports Direct, rather than obtaining information directly from the company before commenting.”

Among the clarifications, Sports Direct said that no agency workers at the Shirebrook warehouse are on ‘zero hour’ contracts, and that agreed hour contracts exist between the worker and the agency.

The main agencies used at the warehouse have confirmed that none of their staff are on ‘zero hour’ contracts, it added.

Some workers in the retail operation are, however, on ‘zero hour’ contracts. According to Sports Direct these arrangements are appreciated by all parties for their flexibility, though it also said that a significant number of its casual retail workers have moved to permanent employment where circumstances allow.

The retailer also denied that it “named and shamed” warehouse workers.

It said that published worker’s league tables do not use employee names, rather they use identification numbers which it says are known only by the agency and the employee. The data is anonymised and is benchmarked against peer performance, it added.

Similarly, it also said that the Shirebrook’s tannoy system is not used to “name and shame” workers either.  Rather than being used to 'harangue' staff, Sports Direct says the system is instead used for logistical purposes.

It denies that staff are penalised for being ill. Instead, it clarifies that sanctions may be applied if workers fail to follow Sports Direct’s reasonable sickness absence notification procedures.

“The company is not aware of any occasions on which sick children have not been able to be collected from school by their parents,” it added.

It confirmed that security procedures, including a ban on workers wearing certain brands sold by the retailer, are in place to manage the risk of theft from the warehouse by employees.

The company added that all staff, including executive management and board members, are subject to searches by trained security staff upon on leaving the Shirebrook facility. The searches are random, it said.

In its recruitment process, Sports Direct says neither it nor its agencies discriminate or favour any applicants on the basis of nationality. And it added that local British citizens do currently work in the warehouse.

“The board believes Sports Direct is a major contributor to all the communities and countries in which it operates; not least, since Sports Direct became a public business in 2007, it has contributed over a billion pounds in tax to the UK exchequer,” the company added.

This afternoon, Sports Direct shares were down 2.5p, 0.43%, trading at 574p each.

Quick facts: Sports Direct International Plc

Price: 321.6 GBX

LSE:SPD
Market: LSE
Market Cap: £1.68 billion
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