• Sports Direct condemned for ‘appalling’ HR practices

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  • 22 Jul 2016
  • Comments 9 comments

Staff ‘not treated as humans’, says parliamentary committee, with punitive sanctions for clocking in late and health and safety failings

The policies and practices that govern how people are treated at Sports Direct have been condemned as “appalling” by the House of Commons Business, Innovation and Skills Committee, as it published its verdict in a long-running inquiry into the retailer.

Describing the firm’s working practices and business model as a “disturbing picture” where staff were “not treated as humans”, the parliamentary committee zeroed in on a handful of HR policies used at Sports Direct’s main warehouse in Shirebrook, Derbyshire.

These include a ‘six strikes’ policy whereby employees can be dismissed for committing half a dozen infringements, which reportedly include being off work sick and fetching a glass of water without authorisation.

The retailer was also slammed for deducting 15 minutes’ pay for clocking in one minute late or returning late from a break. Sports Direct said it had altered this policy so five minutes’ pay was deducted for being four minutes late; however, the committee said this still seemed “ungenerous” and urged owner Mike Ashley to consider reviewing it further and guaranteeing workers would not be punished for being less than four minutes behind schedule.

The committee said Ashley must be held accountable for the firm’s practices. It was “incredible”, said the MPs, that he was unaware of them, given that he visited Shirebrook at least once a week.

The committee also recommended that Ashley and the recruitment agencies employing staff on his behalf – The Best Connection and Transline Group – review the health and safety provisions in the warehouse and report back to them. The local council, Bolsover District Council, and the Health and Safety Executive have been encouraged to "take a more active role" in ensuring provisions are being adhered to.

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.

“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."

Luke Primarolo, the regional officer at Unite, said the union believed many of Sports Direct’s issues stemmed from individuals being agency employees or working on zero-hours contracts. “The road to dealing with this has to involve moving the workforce on to fixed-hours, permanent contracts,” he said.

Primarolo also emphasised that Sports Direct was “by no means” the only company that should be facing scrutiny. He said: “What this highlights is a wider issue of real work today. The government needs to seriously consider what legislation needs to be put in place to protect people from exploitation.”

Shainaz Firfiray, assistant professor of organisation and HRM at Warwick Business School, said the key findings of the report highlighted the value placed on staff by their employers: “Employees expect to be valued at work and treated with dignity, fairness and respect. While there are many organisations that encourage such a healthy environment, there are many others like Sports Direct where leaders undermine employee autonomy, devalue their contributions and weaken their morale.

"Leaders who fail to treat employees with consideration have a toxic influence in the workplace because they undermine dignity at work.

“Once an employee’s dignity is violated, a series of negative consequences are likely to result. Organisations that do not treat their staff with dignity are characterised by mistrust, anger, fear, poor communications and a lack of goodwill. Most skilled managers and leaders realise that treating people with dignity and respect is not only important for social relations at work, but also makes business sense."

The committee said it would be accepting an invitation by Ashley to visit Shirebrook. “We hope that this will be the start of a constructive dialogue, in which we will receive regular updates on Mr Ashley’s review,” it said.

The committee is also continuing its broader inquiries into the labour market, while Sports Direct is the subject of a separate investigation by HMRC into its failure to pay some staff the minimum wage. Ashley admitted this had occurred in some instances when he appeared before the committee in June, and this week the Guardian claimed the HMRC investigation had been extended to cover the retailer’s store staff.

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Comments (9)
  • HR is well and truly dead in some organisations. It is quite sad as these so-called HR practitioners in these organisations went into this noble profession with the wrong intentions. They have forgotten that HR is the marriage of protecting human resources and building a great company. They have forgotten that human resources are a company's greatest resource. They pander to management and turn a blind eye to truly horrible practices. Draconian measures in response to minor infringements and employees' making genuine mistakes at work. They strip employees of all support even during challenging times in their lives. They see people as just numbers and refuse to set management straight; actively aiding and abetting them in breaking employment law. It is very sad indeed.

  • Does Sports Direct have an HR team? If they do are they members of the CIPD? IF they are members are the CIPD reviewing their conduct?

  • To simplify matters further, I would like to propose that whistle blowing should not be perceived as an optional obligation any more.

    It must be made a "mandatory responsibility" and fully owned by the Head of HR, holding more than one person responsible can dilute focus and affect penalisation where applicable.

    In the modern day work place, employee well being should not be viewed as optional.

  • It's heartening and admirable to note that whistle blowers, the media and trade unions are working in tandem and ensuring safety, boosting workers self esteem and working to achieve fair practices within organisations…

    While it is very difficult to comprehend why and how a Business House within the UK could have had such harsh employee policies, it is infact quite easy to prevent history from repeating itself.

    The proposed solution:

    Fresh legislation should designate the HR Head as the “Chief Whistleblower” within every establishment. To be held responsible if such harsh/draconian HR policies are found to exist within their respective organisation.

    To simplify further, a two step whistle blowing process may be rolled out:

    A) Review of current HR practices by the HR Head followed by “Internal Whistle blowing” for the attention of the Board/ Business owner, followed by identification of areas that require policy revision/fine-tuning. Prioritising and linking the required changes to reasonable time frames, monitoring all progress and continually following up until task completion.

    B) If expected changes do not materialise within the stipulated time, “External Whistle blowing” must occur forthwith. Such internal and external whistle blowing should be made mandatory at the HR head level.

    To be effective the legislation must be given teeth and stiff penalties against defaulting HR Heads and Business owners should be proposed.

  • Did Sports Direct not have any HR staff who could challenge these practices? I am not saying it's easy to change things if senior leaders are hell bent on flouting the rules but HR can and should at least act as the conscience of the business. Fine - it sounds like you would be fired if you spoke out but I see that as part of the HR role to challenge constructively.

  • What role did the HR department play in developing these practices? I personally don't think members of this professional body should be associated with these practices. Perhaps as an organisation we should have a whistle blowing system so members can seek advice and help. Also membership should be withdrawn from people who are setting up these practices. It also demonstrates that in organisations that do not have a strong union presence that people are more likely to be exploited. The union who raised these working practices should be applauded.

  • As always the organisation gets a slap on the wrist and a fine.

    1) Are the powers at be going to ensure that those staff who have been short changed with regard to the minimum wage are going to get this back paid?

    2) Are those staff who were dismissed without good reason going to be supported to go through the tribunal process?

    Shame on them. I thought all the workhouses had been closed down years ago.

  • This has been going on for many years! Mike Ashley has always thought that somehow he is immune to reasonable employment laws! I hope he is dealt with!!

  • Does the HR Department have CIPD members as staff? CIPD a professional body with standards? Action? Please tell us what the CIPD is going to do. Please tell us how the CIPD influences real HR.