Sports Direct has agreed to pay money back to thousands of workers who lost out after being effectively paid less than minimum wage by the company while employed in its warehouses, according to a report from The Guardian.
The payments centre around an investigation into Sports Direct’s working and employment practices by the House of Commons Business Select Committee, which found that conditions in some of the company’s warehouse facilities were akin to those in a “Victorian workhouse.”
The inquiry, which was first sparked after an undercover investigation by The Guardian, found that workers were effectively earning less than minimum wage thanks to the company not paying staff for time when they were going through mandatory security checks in Sports Direct’s Shirebrook warehouse.
As a result, the FTSE 250 retailer will now pay extra wages, worth around £1 million according to reports, to staff who are members of the Unite union. It is not clear exactly how many people will receive payouts, but roughly 1,700 staff employed by Transline — an agency used by Sports Direct to provide workers — are thought to be in line for a payout. Some staff will receive as much as £1,000, The Guardian reports.
Speaking about Sports Direct’s new payouts, Steve Turner, the assistant general secretary of the Unite union said:
“Investors and customers alike should not be fooled into thinking that everything is now rosy at Sports Direct’s Shirebrook warehouse. Transline, one of the employment agencies involved, is disgracefully still trying to short-change workers by seeking to duck its responsibilities.”
“Deep-seated problems still remain regarding the use of agency workers with the behaviour of both Transline and The Best Connection further jeopardising Sports Direct’s battered reputation.”
Her Majesty’s Revenue and Customs is also thought to be party to the deal agreed between Sports Direct and Unite.
The deal is just another chapter in the scandals that have rocked Sports Direct in the past year. The BIS Committee’s investigation revealed numerous shocking allegations against the company, including that one staff member at the Shirebrook facility was so scared to miss work that she gave birth to a child in the toilets at the warehouse.
Sports Direct’s stock price has cratered as a result of the investigations, and thanks to fears about the company’s future. Shares are down massively in the last year, falling from £8 per share in August 2015, to £3 per share today. The stock’s fall has led to the company being demoted from the FTSE 100 to the less prestigious FTSE 250. Here is how that fall looks:
Shares in the company are down 2.85% on Monday.
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