Elusive British billionaire Mike Ashley is known as a ruthless businessman. And one can argue that the latest set of research about his company Sports Direct confirms this notion.
Ashley’s Sports Direct empire is worth £4 billion but, according to options trading firm Banc De Binary, he makes one of the lowest contributions to staff pensions out of all the firms in the FTSE 100. On average, Sports Direct only contributes £82 per employee annually.
This is dramatically lower than the
£2,920 per staff member, on average, for the FTSE 100 as a whole. It only ranks behind the mining group Antofagasta, which paid just £16, while troubled security firm G4S ranked second. (Notably, these companies have a bulk of staff which are outside the UK, which therefore wouldn’t qualify for British government enforced pensions.)
Unsurprisingly, the FTSE 100 companies doling out the most in pensions are Britain’s biggest banks (even the part government-owned ones). For example, Barclays paid £688 million towards staff pensions last year and 81% state-owned lender Royal Bank of Scotland contributed £656 million.
“A lot of the banks have inherited pension schemes that are relatively expensive,” said Oren Laurent, founder of Banc De Binary in the report. “That made sense when there was an effort to attract and retain top talent however now that they are trying to cut staff costs they have been looking at ways of reducing pension costs.“
“At the other end of the spectrum a retailer like Sports Direct stands out for giving its staff very few fringe benefits — which clearly restricts their ability to get their more talented staff to see the company as a long-term employer.”
Sports Direct declined to comment to Business Insider on the research and whether it would make any changes to its staff pension scheme or contributions.
Ashley’s Sport Direct has come under fire for years over its treatment of its employees as the sporting clothing giant is a prolific user of the zero hours contract.
The controversial terms of employment does not guarantee work and does not provide sick, holiday, or maternity pay.
Around 90% of the 15,000-strong Sports Direct workforce are on zero hours contracts.
This also means that these people would be excluded from the government’s obligatory pensions auto-enrolment scheme. Auto-enrolment means that your employer would automatically cough up a percentage of your salary into a pension scheme automatically every payday.