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Sports Direct insurance scheme legality questioned

Sports Direct insurance scheme legality questioned

Sports Direct insurance scheme legality questioned Mike Ashley, the famous deputy executive chairman and founder of Sports Direct, has come under fire for what has been described as “extremely disturbing working practices” at the company with the legality of its insurance schemes also called into question.

A report by the Business, Innovation and Skills (BIS) Select Committee raises concerns about the “voluntary schemes” employed by the agencies Sports Direct had relations with – including their insurance services.

In its report, the BIS Committee suggests it received a “disturbing picture” of the working practices and business model at Sports Direct with Mr Ashley admitting that workers were paid below the national minimum wage and that the company had become too big for him to control. Reports suggest that workers were punished for drinking water and taking time off when ill, with further allegations that they would be promised permanent contracts in exchange for sexual favours and a number of health and safety concerns, including a story about one woman giving birth in a toilet.

In his notes to accompany the report, Iain Wright MP, Chair of the Business, Innovation and Skills Committee, said: “Whistleblowers, parts of the media and a trade union shone a light on work practices at Sports Direct and what they revealed was extremely disturbing. The evidence we heard points to a business whose working practices are closer to that of a Victorian workhouse than that of a modern, reputable High Street retailer. For this to occur in the UK in 2016 is a serious indictment of the management at Sports Direct and Mike Ashley, as the face of Sports Direct, must be held accountable for these failings.

“It’s seems incredible that Mike Ashley, who visits the Shirebrook warehouse at least once a week, was unware of these appalling practices. This suggests Mr Ashley was  turning a blind eye to conditions at Sports Direct in the interests of maximising profits or that there are  serious corporate governance failings which left him out of the loop in spite of all the evidence.

“Mike Ashley had to be brought kicking and screaming to answer the Committee’s questions about working practices at Sports Direct. To Mr Ashley’s credit, when he gave evidence he was open and willing to engage and he is now setting out some of the steps which Sports Direct needs to take to stop these practices recurring. The continual refusal to appear before our Committee is regrettable, because his public pledges whilst before the Committee to improve working conditions could have been made so much sooner. The Business Committee will visit Shirebrook and will continue to hold Mr Ashley’s feet to the fire, in as constructive a manner as possible, checking on the progress he makes on improving working conditions for workers at his premises.”

The workers at the Shirebrook warehouse are not directly employed by Sports Direct but are actually employed by agencies The Best Connection and Transline Group which the Committee finds Sports Direct has a “strong grip over”.

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