In my role as Chair of the Business, Innovation and Skills Select Committee, I have overseen the inquiry into and production of a report into the working practices at Sports Direct.
Much of the attention focused on working conditions at the company’s warehouse at Shirebrook in the Midlands, but Sports Direct is also the largest sports retailer in the country and has a shop in Hartlepool. The findings of the report therefore have a direct implications for people who live and work in the town.
This week, following the publication of the Business Committee report, a separate report was published regarding Sports Direct’s working conditions by the company’s lawyers. It confirmed some of the significant shortcomings that the Select Committee identified and has pledged to end practices such as the “six strikes and you’re out” policy, whereby a worker at the warehouse could be given a “strike” for fairly innocuous behaviour such as taking too long going to the toilet or having a drink of water on a shift.
The new report, produced by Sports Direct’s lawyers, has agreed to address many of these issues. Perhaps most significantly for Hartlepool workers at Sports Direct, those employees on zero hours contracts will transfer to more permanent forms of employment. The company has only pledged at this stage to guarantee 12 hours a week for permanent contracts, but it’s a start and will provide a better degree of security.
This report is a good start, and a welcome development following the select committee report. However, I would question the impartiality of the lawyers who have complied the report- employed as they are by Sports Direct and whose expertise does not lie in employment law. This rather belies the claim made by Mike Ashley when he appeared before the committee back in June- that the report would be complied by ‘Sports Direct’s independent lawyers’. I agree with the Investor Forum, the Trade Union Share Owners, and others, that there should be a fully independent review of Sports Direct.
The report also fails to address a number of important issues raised by the Business Committee inquiry. It fails to respond to questions regarding the number of warehouse workers employed through agencies and why they are employed on short-term contracts, other than to reduce costs and avoid legal responsibility for their poor working conditions.
Serious failings in corporate governance directly contributed to the failure to address the disturbing working practices at Sports Direct. We on the committee are pleased that Sports Direct accepted our call for a review of corporate governance, and have agreed to instigate an external report evaluating the Board later this financial year.
I hope the pressure that was placed on Sports Direct by not only the Select Committee but by Unite the trade union and parts of the media will ensure that further progress for workers’ rights and conditions is made, not merely at this company but across the industry.