The Sports Direct founder, Mike Ashley,has been warned he could be found in contempt of parliament after failing to give MPs a date to answer questions about his company’s treatment of workers.
The move represents the latest setback to the tycoon and owner of Premier League strugglers Newcastle United. Ashley has seen almost £1bn wiped from his personal fortune after a downturn in trading at the store chain and a Guardian investigation which revealed that thousands of the retailer’s temporary warehouse workers were receiving effective hourly rates of pay below the minimum wage.
In a strongly worded letter to the billionaire, Iain Wright MP, the chairman of the business, innovation and skills (BIS) committee, said: “A number of alternative dates have been offered to you by the committee clerk, but as yet you have not accepted any of them, nor agreed in principle to attend. As you will be aware, select committees do not normally need to have recourse to our formal powers to summon witnesses in order to secure attendance; refusal to attend without good reason may be considered a contempt of the house.
“Should you fail in your reply to agree to attend on one of the dates offered to you, or a mutually convenient alternative before 1 June, the committee reserves the right to take the matter further, including seeking the support of the House of Commons in respect of any complaint of contempt.”
Wright has given Ashley, who owns 55% of Sports Direct, until 21 March to reply.
The standoff is the second time Ashley has resisted attempts to have him give evidence to MPs. He declined an invitation to appear in front of the Scottish affairs select committee last year, explaining that he was busy on the dates suggested. Instead, the company sent its chairman, Keith Hellawell, who repeatedly struggled to answer detailed questions.
Ashley has offered to meet the BIS committee privately at Sports Direct’s headquarters in Shirebrook, Derbyshire, but Wright has declined “in line with select committees’ commitment to transparency”.
A spokesman for Sports Direct said: “Mike Ashley has previously invited members of the committee to attend Shirebrook in order to see for themselves the company’s working practices. That invitation remains open. Mike will respond to the committee’s recent letter in due course.”
Last year, undercover Guardian reporters employed inside the retailer’s warehouse found that thousands of workers were subjected to an extraordinary regime of searches and surveillance, while local primary schoolteachers also told the newspaper that pupils could remain in school while ill – and return home to empty houses – as parents working at the depot were too frightened to take time off work.
The reports added to the pressure on the firm, which had already been accused of operating “Dickensian practices” by the union Unite. Ashley responded to the Guardian’s reports by announcing a pay rise for staff, as well as a review of all agency staff terms and conditions, which he would oversee personally.
However, the moves – coupled with disappointing trading by the retailer – failed to relieve any pressure from the group’s shares and the company was relegated from the FTSE 100 last week.
Outside retailing, Ashley has also suffered a number of reverses. Newcastle United, the football club he owns, is reportedly scrambling to find a new manager as the team struggles against relegation from the Premier League.
Meanwhile, the tycoon has been hit by a series of problems in his high court battles with Scottish championship club Rangers, of which he owns about 9%, including being chastised by a high court judge for abusing the legal system to “intimidate” the club’s chairman, Dave King.
Theoretically, contempt of the house of commons can be punishable by imprisonment, although the powers are so archaic they may no longer be practically enforceable.
The government’s green paper on parliamentary privilege, published in 2012, said: “[Parliament’s] power to punish non-members for contempt is untested in recent times. In theory, both houses can summon a person to the bar of the house to reprimand them or order a person’s imprisonment. In addition, the House of Lords is regarded as possessing the power to fine non-members. The House of Commons last used its power to fine in 1666 and this power may since have lapsed”.
If Ashley continues to refuse to give evidence, the most likely procedure is for the select committee to seek the support of the Commons for “an order to attend”, effectively a summons.
If that fails, the matter could either be referred to the committee of privileges to rule upon contempt, or, if the offence is blatant, parliament itself could take action through a motion deploring the witnesses conduct, all of which could inflict further damage on the reputations of Ashley and his company.
