Sports Direct’s policies of fining warehouse staff for being just one minute late and paying employees less than the minimum wage are “unacceptable”, founder Mike Ashley has told MPs.
The founder of Sports Direct also told MPs on the business, innovation and skills select committee that the company had “probably” outgrown him and was too big for him to manage.
The firm is renown for having a tough disciplinary system, with the use of controversial zero-hours contracts and time-consuming security searches, leading to staff earning under the minimum wage.
Union officials said the Derbyshire distribution centre operated a system where staff were given “a strike” for things such as spending too long in the toilet, excessive chatting or taking a day off sick. Once an employee had six strikes they were automatically dismissed.
MPs also heard that some staff were paid through a pre-paid card. Staff were charged £10 to get a card, plus a £10-a-month management fee, 75p to use it at an ATM machine, and 10p when they got a text message confirming they had used it.
There are also investigations underway regarding working practices at the firm’s Derbyshire warehouse after a series of serious allegations were made.
According to officials, there had been 110 ambulance callouts to the warehouse within the space of a year, including 38 times when workers had complained of chest pains. Five ambulances had been called to Sports Direct’s warehouse in birth and miscarriage related matters, including one worker who gave birth in the toilets due to fear of losing her job if she called in sick.
In response to the allegations, Ashley, who begun an internal investigation into the allegations six months ago, admitted that he had discovered some issues.
He said that the time it took for staff to undergo security checks after finishing work and the issue of being paid less than minimum wage, had now been addressed.
The Newcastle United owner blamed much of the firm’s problems on the firm’s rapid growth, saying the internet hadn’t existed for the retailer ten years ago.
Some 79 percent of the firm’s staff are employed on zero-hour contracts, with no guarantee of hours, and Mr Ashley agreed some staff should be transferred to full-time employees.
He pledged to implement a number of changes to working practices within 90 days, promising to write to MPs if the time frame needed to be extended.