The head of troubled company Sports Direct is to face criminal charges over his handling of staff redundancies. Dave Forsey is thought to be the first FSTE100 chief executive to face charges under the Trade Union Act.
The Insolvency Service announced last week that Forsey had been charged after failing to inform authorities of plans to lay off staff from the Dundonald warehouse in Scotland. The redundancies were made in relation to the controversial pre-pack administration of fashion chain West Coast Capital (USC). 200 workers at the USC site were given a brisk 15 minutes notice by administrators that they would be being axed from the firm, before the company was abruptly shut down.
Under employment law, anyone involved in such a wide ranging sacking should be given a minimum period of 30 days consultation before losing their positions.
Forsey has reportedly resigned from the board and is due in court. If found guilty, the CEO could be fined up to £5,000 and banned from holding directorships for 15 years.
Sports Direct were featured in a BBC documentary just last week. Inside Out exposed a series of controversial agency imposed working regulations at one of the company’s warehouses that were leading to many employees avoiding taking sick leave out of fear of losing their jobs.The BBC also found that an unusually high number of ambulance call outs had been made from the warehouse.
Sports Direct have been under the spotlight several times in recent years for its treatment of employees, most notably in 2013 when their use of zero hours contracts was heavily criticised.