Sports Direct warehouse staff to receive back pay

Deal struck with Unite and HMRC affects thousands of workers and follows Guardian investigation into pay rates at retailer

Thousands of Sports Direct warehouse workers are set to receive back pay totalling about £1m after the retailer admitted breaking the law by not paying the national minimum wage.
The move, which follows an undercover Guardian investigation last year that exposed how Sports Direct workers were being paid less than the legal minimum, is to include payments backdated to May 2012 and could be worth up to £1,000 for some workers, trade union officials estimate.
The agreement, which is understood to have been struck between the union Unite, the retailer and HM Revenue & Customs, includes workers directly employed by Sports Direct and staff hired through temporary employment agencies. Two agencies, The Best Connection and Transline, provide most of the 3,000 workers in the company’s warehouse in Shirebrook, Derbyshire.
Payments are expected to begin to be made from the end of this month.
Those familiar with the deal, however, say that 1,700 Transline agency workers may initially receive half the back pay they are owed, because the agency is refusing to refund unpaid wages from before it took over contracts from a rival agency two years ago.
Steve Turner, Unite’s assistant general secretary, described the agreement as a significant victory that demonstrated the importance of modern trade unions in Britain.


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“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,” he said.
“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.”
Unite, Britain’s biggest union, has led a long-running campaign against working conditions at the Shirebrook depot.
Sports Direct, Transline and The Best Connection had not responded to requests for comment by publication.
In December, Transline said: “We do not breach national minimum wage legislation. Like many other retail warehouse operations throughout the UK, Shirebrook also has a policy of searches for all warehouse employees, office staff, senior management, directors and visitors.
“As with all policies, these are constantly under review. The searches are conducted in accordance with employment contracts and are completed as quickly as possible.”
In June, Sports Direct’s billionaire founder Mike Ashley admitted his company had broken the law by failing to pay staff the national minimum wage.
The concession, which was made when he appeared before MPs investigating his firm’s treatment of its workers, confirmed the findings of the Guardian’s investigation, which revealed that warehouse staff were required to go through searches at the end of each shift, during which their time was unpaid. They also suffered deductions from their wage packets for clocking in for a shift a minute late.
The practices contributed to many staff being paid an effective rate of about £6.50 an hour against the then statutory minimum wage rate of £6.70, saving the firm millions of pounds a year at the expense of some of the poorest workers in the UK.




Ashley said that he had moved to address the queues of workers waiting, unpaid, to be searched at the end of each shift, but also admitted that docking workers 15 minutes’ pay for being one minute late was unacceptable and unreasonable.
Both practices had led to breaches of minimum wage legislation, the Guardian investigation found.
HMRC said: “This isn’t about doing deals. While we don’t discuss individual cases we won’t accept anything less than what’s owed. Our role is to investigate all cases where we believe an employer is not paying its workers the national minimum wage to ensure those workers receive what they are owed under the law.”

https://www.theguardian.com/business/2016/aug/15/sports-direct-staff-to-receive-back-pay-unite-hmrc