Sports Direct founder questioned over exploitation allegations

Summary

Billionaire tycoon Mike Ashley admitted that Sports Direct was paying workers below the minimum wage due to lengthy security checks. An undercover investigation led to an HMRC inquiry. Union Unite submitted a dossier detailing a bullying culture and poor working conditions, likening them to a 'gulag'. There were 110 ambulance call-outs at the Derbyshire warehouse, with 50 classified as life-threatening. Ashley faced criticism for a zero-hours contract culture, with 79% of staff on such terms. He acknowledged the need for change but was noncommittal. Allegations of sexual harassment were also raised, prompting Ashley to accept responsibility and promise improvement.

Takeaways

• 💼 The billionaire tycoon is accused of failing to pay his workforce adequately, with some workers receiving as low as six pounds per hour.
• 🚨 An undercover investigation revealed that due to security checks, workers were effectively being paid below the minimum wage.
• 🔍 HMRC is conducting a formal inquiry into the company's practices, following the revelations from the investigation.
• 🏭 The company culture at Sports Direct has been likened to a 'gulag', with allegations of bullying and poor working conditions.
• 🚑 There have been 110 ambulance call-outs at the Derbyshire warehouse in three and a half years, with 50 classified as life-threatening.
• 🤰 In one extreme case, a woman gave birth in a toilet, highlighting the pressure and lack of support for employees.
• 📉 The company's 'six strikes and you're out' policy on absenteeism is criticized for creating a high-pressure environment.
• 🛍️ Sports Direct is known for its zero-hours contracts, with 79% of its staff employed on this basis.
• 🕒 The company has a strict policy on tardiness, where being a minute late can result in a 15-minute penalty.
• 🚫 There are allegations of sexual harassment against women at Sports Direct, which the company needs to address.
• 📉 The founder, Mike Ashley, acknowledges that the company may have outgrown his ability to manage it effectively.

Q & A

What was the issue with the billionaire tycoon's workforce payment?

The billionaire tycoon, Mike Ashley, admitted that his company, Sports Direct, was effectively paying workers below the minimum wage due to security checks that extended working hours.

What was the legal minimum wage at the time of the scandal?

The legal minimum wage at the time was six pounds seventy an hour.

What was the undercover investigation's finding regarding Sports Direct's working conditions?

The undercover investigation found that working conditions at Sports Direct were likened to a gulag, with allegations of bullying and an unusually high level of accident reports.

What was the 'six strikes and you're out' policy mentioned in the script?

The 'six strikes and you're out' policy referred to Sports Direct's strict absenteeism policy, where even sickness and taking time off for having a baby counted against staff.

How many ambulance call-outs were there at the Derbyshire warehouse over the reported period?

There were 110 ambulance call-outs at the Derbyshire warehouse over the last three and a half years, with 50 classified as life-threatening.

What was the situation regarding zero-hours contracts at Sports Direct?

Seventy-nine percent of Sports Direct's staff were employed on zero-hours contracts, with only 200 people employed directly at the warehouse and 3000 through an agency.

What was Mike Ashley's response to the allegations of a zero-hours culture?

Mike Ashley acknowledged the issue and mentioned that Sports Direct was reducing the percentage of staff on zero-hours contracts.

What was the company's policy regarding lateness?

If an employee was a minute late, they had to work an additional 15 minutes without pay.

What were the allegations about the treatment of women at Sports Direct?

There were allegations of women being targeted sexually at Sports Direct.

How did Mike Ashley respond to the sexual harassment allegations?

Mike Ashley acknowledged that there probably was sexual harassment happening at Sports Direct and stated that the company needed to improve.

What was the overall impact of the scandal on Sports Direct's public image?

The scandal led to public scrutiny and a focus on the delivery of Mike Ashley's promises to improve conditions at Sports Direct.

Outlines

00:00

💼 Sports Direct's Wage Scandal

The paragraph discusses the scandal involving Sports Direct, a company led by billionaire Mike Ashley, where workers were allegedly paid below the minimum wage due to extended security checks. The company's culture is criticized as being akin to a 'gulag' with bullying and high-pressure policies, leading to numerous accidents and even life-threatening situations. The company's zero-hours contract policy is highlighted, with almost eighty percent of staff on such contracts. Ashley acknowledges the issues and hints at potential changes, though he is noncommittal about specific reforms.

Keywords

💡Billionaire Tycoon

A billionaire tycoon refers to an extremely wealthy business magnate. In the context of the video, the billionaire tycoon is the owner of Sports Direct, who is under scrutiny for his company's labor practices. The term is used to emphasize the vast wealth and influence of the individual in contrast with the issues faced by his workforce.

💡Workforce

The workforce refers to the collective body of employees or laborers in a company. The script discusses the billionaire tycoon's workforce at Sports Direct, highlighting issues such as underpayment and poor working conditions, which are central to the video's theme of corporate responsibility and labor rights.

💡Minimum Wage

The minimum wage is the lowest hourly, daily, or monthly remuneration that employers are legally required to pay their workers. The video script reveals that Sports Direct was effectively paying workers below the minimum wage, which is a violation of labor laws and a significant ethical issue.

💡Undercover Investigation

An undercover investigation is a type of journalistic inquiry where reporters or investigators work covertly to uncover hidden information or illegal activities. The script mentions an undercover investigation that led to revelations about Sports Direct's labor practices, emphasizing the secretive and potentially unlawful nature of the company's operations.

💡HMRC

HMRC stands for Her Majesty's Revenue and Customs, which is the UK government's tax and customs authority. The script confirms that HMRC initiated a formal inquiry into Sports Direct following the undercover investigation, indicating the gravity of the alleged violations and the involvement of authorities.

💡Union Unite

Union Unite refers to a labor union that represents the interests of workers. In the video, Unite submits a dossier detailing a company culture rife with bullying and poor working conditions, illustrating the role of unions in advocating for worker rights and highlighting the extent of the issues at Sports Direct.

💡Zero-Hours Contract

A zero-hours contract is an employment agreement that does not guarantee a minimum number of working hours, often leading to job insecurity and unpredictable income for workers. The script reveals that a significant portion of Sports Direct's staff are employed on zero-hours contracts, which is a key issue in the video's discussion of exploitative labor practices.

💡Absence Policy

An absence policy is a set of rules that dictate the consequences for employees who are absent from work. The video script criticizes Sports Direct's 'six strikes and you're out' policy, which penalizes workers for absences, including sick leave and parental leave, underscoring the harsh and potentially inhumane nature of the company's labor policies.

💡Ambulance Call-Outs

Ambulance call-outs refer to instances where emergency medical services are summoned. The script mentions numerous ambulance call-outs at Sports Direct's Derbyshire warehouse, including life-threatening situations and a woman giving birth in a toilet, highlighting the severe health and safety concerns arising from the company's labor practices.

💡Sexual Harassment

Sexual harassment is unwelcome conduct of a sexual nature in the workplace. The script alludes to allegations of sexual harassment at Sports Direct, which is a serious violation of employee rights and contributes to the video's portrayal of a toxic company culture.

💡Tardiness

Tardiness refers to the act of being late. The video script discusses Sports Direct's draconian response to tardiness, where being a minute late could result in severe penalties, illustrating the company's strict and potentially unreasonable expectations of its workforce.

Highlights

Billionaire tycoon accused of failing to pay workers minimum wage.

Workers were paid £6.50 per hour instead of the legal minimum of £6.70.

Mr. Ashley admits to unpleasant surprises regarding company practices.

Security checks at Sherbrooke added significant time to staff working hours.

HMRC launched a formal inquiry into Sports Direct's pay practices.

Union Unite submitted a dossier detailing a bullying company culture.

Work conditions at Sports Direct likened to a gulag.

Mr. Ashley acknowledges a six-strikes policy on absenteeism.

High levels of accidents reported at Derbyshire Warehouse.

110 ambulance call-outs in the last three and a half years.

50 ambulance call-outs classified as life-threatening.

A woman gave birth in a toilet at the warehouse.

Sports Direct employs a fifth of all zero-hours contracts on the high street.

Mr. Ashley is accused of a zero-hours culture.

79% of staff are employed on a zero-hours basis.

Mr. Ashley suggests reviewing the makeup of full-time and zero-hour contracts.

Company's draconian response to tardiness criticized.

Allegations of sexual harassment at Sports Direct.

Mr. Ashley admits that the company may have outgrown his ability to manage.

Public scrutiny now focuses on the delivery of Mr. Ashley's promises.

Transcripts

my cash lead the billionaire tycoon and

then there's his workforce some of whom

he's failed to pay even six pounds

seventy an hour

caelum high sell him cheap but behind

the cheery humming there's been a

scandal brewing about the culture of

Sports Direct I really am NOT enjoying

this

and today came the admission do you

accept that the company was effectively

paying workers below the minimum minimum

wage on that specific point for that

specific bit of time yes some things

have come as a bit of an unpleasant

surprise yes could you tell the

committee what those unpleasant

surprises are first thing that I looked

at was the bottling and that was that

wasn't our best every day mr. Ashley is

referring to his security checks at

Sherbrooke that were adding so much time

to staff working hours that they were

effectively being paid six pound fifty

an hour rather than the legal minimum of

six pounds seventy the results of the

undercover investigation have led to a

formal inquiry by HMRC confirmed for the

first time by mr. Ashley today but it's

not just pay union Unite today submitted

an explosive dossier pack for details

about a company culture full of bullying

where work conditions were likened to

that of a gulag these are conditions

that are just unacceptable in 21st

century Britain and if you don't stop it

here of course the problem that you get

is that this then extends itself across

the economy the root of the problem is

the six strikes in your out policy on

absenteeism it's a bigger asleep it's

sickness and even taking time off to

have a baby

count against staff which has created a

powder keg of pressure sparking an

unusually high level of accident reports

at the Derbyshire Warehouse at the

center of allegations there have been a

hundred and ten ambulance call-outs in

the last three and a half years 50 have

been classified life-threatening five

involve difficulties in pregnancy and in

one case a woman gave birth in a toilet

there will be things in a company that

size that do happen that shouldn't

happen I didn't build Sportster exports

direct film link you understand it's not

having going out one day and you've got

a tiny little inflatable and you're in

control and the mixed wake up not

morning and you're an oil tanker Mike

Ashley stands accused of a zero-hours

culture in fact one fifth of all zero

hours on the high street or through

Sports Direct altogether seventy nine

percent of his staff are employed on

that basis with just two hundred people

employed directly at his warehouse and

three thousand through an agency and are

reducing the percentage of staff on zero

hours some of our top people have come

from the zero contract employment oh

that sounds positive would I think that

is a reasonable thing that you're saying

would I think sports direction be able

to review that without me and at least

make the easy first little step so is

that a yes will there be a change in the

makeup of full-time in zero hour

contracts about sympathy but I'm not

sure so that's a no then and he was also

pulled up on the company's draconian

response to tardiness if you were a

minute late you've got 15 minutes paper

you asked me what I think I think it's

unacceptable you asked me what I think I

think it's unacceptable if I thought it

was acceptable I wouldn't change it then

there were the allegations about women

being targeted sexually and the response

very much in the unique ashley style are

you absolutely sure you can sit here and

say those there's no what you'll call

sexual than in the office harassment

happening in sangs bruce it differences

i think there probably is and sports

direct therefore has to pull its socks

up simple as that fellas so you're

accepting them as lobby well a lot of

it's gone to you yeah you've created a

lot of well you've done something

absolutely remarkable do you think your

company is outgrown your ability to

probably a long time ago quickly added

to do that that's gonna guarantee we get

a better income result so a family

getaway right that will help with maybe

the words I think yes even when he makes

a mistake Ashley and master of playing

the crowd he left Parliament having done

the same with MPs to watch him is to be

beguiled but for Sports Direct the

problems haven't just disappeared with

public scrutiny now zeroing in on the

delivery of his promises