Sports Direct has failed to meet a pledge to offer guaranteed hours to shopworkerss and transfer some warehouse staff to permanent contracts a year after promising widespread changes in working practices.
The retail group controlled by the Newcastle United owner, Mike Ashley, promised to ensure that all staff were treated with dignity and respect in a report on its working practices published on 6 September last year.
Key pledges included offering casual retail staff guaranteed hours instead of zero-hours contracts and testing a scheme to transfer 10 warehouse staff a month from insecure agency contracts to Sports Direct’s employment.
The review was initiated after the Guardian exposed how temporary workers at its depots were effectively receiving hourly rates of pay below the minimum wage. It also came after heavy criticism of corporate governance at Sports Direct which led to investor pressure to oust its chairman, Keith Hellawell.
Hellawell remains under pressure from shareholders, with Hermes Investment Management on Tuesday saying he and senior independent non-executive Simon Bentley should go after failing to engage on a one-to-one basis with investors.
Leon Kamhi, head of responsibility at Hermes, added that Wednesday’s meeting in Shirebrook, Derbyshire, would be an “excellent opportunity for the board to update investors” on progress made in implementing the working practices report.
His comments come as the Unite union said Sports Direct, which has been widely criticised for its heavy use of zero-hours contracts in stores, continues to advertise roles with “no guaranteed hours of work”. There is no evidence that casual staff already employed had been offered contracts with guaranteed hours.
The union added that there was no evidence that Sports Direct was moving significant numbers of agency staff at its warehouse into direct employment.
The Unite assistant general secretary, Steve Turner, said: “This revelation shows it is ‘business as usual’ at Sports Direct and casts doubt on just how sincere it is about cleaning up its act.”
Turner added: “One year on Sports Direct has been caught redhanded breaking its promise to offer workers the security of knowing what hours they will work and how much they will earn from week to next.
“It blows a hole in Sports Direct’s commitment to treat workers with dignity and respect.”
Trade Union Share Owners (Tuso), a group which last year supported a resolution calling for an independent review of Sports Direct’s working practices, has written to investors urging them to vote against Hellawell’s reappointment as it raised concerns about health and safety issues, the continued use of zero-hours contracts and the lack of a truly independent review of working practices.
In an update to investors, Tuso said there had been 11 accidents at the Sports Direct Shirebrook warehouse since 7 September last year, according to a freedom of information request made to Bolsover district council. These included numerous back and head injuries and three “major” injuries, including a fractured hand, damage to and potential loss of sight in one eye and a head injury, which led to a loss of consciousness.
The group urged the Health and Safety Executive to help the local authority investigate as a matter of urgency. It said workers had raised concerns about crowded isles, defective warehouse equipment and products stacked dangerously high.
A spokesman for Sports Direct declined to comment on the union claims.
In its annual report, the company said: “We have made positive progress across the business as we continue to strive to ensure that all of our people are treated with dignity and respect.”
It added that it had “taken steps to promote stability for [these groups of workers] by ensuring changes to scheduled hours by the company [were] kept to a minimum”.
It said: “Our research found that in common with surveys by other companies, the vast majority of our casual staff wish to remain on flexible arrangements.”
The company has elected a worker representative to sit on its board and said he would continue to ensure good practice. But Tuso said: “[Sports Direct] missed a crucial opportunity to give investors and stakeholders the reassurance that they are 100% committed to dealing with well-documented workplace abuses and corporate governance failures” by going back on a promise to appoint an independent party to conduct a “360 degree review” of its corporate governance.
After more than one candidate backed out, the company in January appointed the law firm RPC which has a long history of working for Sports Direct.
Hellawell has pledged to step down if more than half the group’s independent investors fail to back him at Wednesday’s AGM. Last year, more than half of independent shareholders voted against the chairman, forcing the company to hold a second vote in January where he was kept in place only with the backing of Ashley, who owns more than half of Sports Direct’s shares.
