Sports Direct has caved into pressure over its use of controversial zero hours contracts in a victory for campaigners who have called on the company owned by billionaire Mike Ashley, to end the “abusive” practice.
Former employee Zahera Gabriel-Abraham took the company to an employment tribunal, which was due to be heard next month, over its policy of employing nearly 20,000 staff on contracts which guarantee no fixed hours each week.
The company, which is the UK’s biggest sporting retailer, agreed to settle out of court and will now re-write all job adverts and employment contracts to expressly state that “casual” roles will not guarantee any work.
Staff will also have holiday and sick pay explained to them more clearly, with many not realising they are entitled to paid holiday and to claim for sick days.
The new policies will be displayed in Sports Direct staff rooms and all managers will be reminded of their responsibilities for equal opportunities.
Sports Direct will continue to use zero hours contracts, however, it is a major victory for campaigners and MPs who have been met with a wall of silence from the company previously.
Elizabeth George, from the law firm Leigh Day, who represented Ms Gabriel-Abraham in her claim against Sports Direct for sex discrimination, unfair treatment and breach of holiday rights, said: “Sports Direct continue to deny any wrong doing or short-falls in their treatment of zero hours workers but Zahera and many more of the company’s zero hours staff will tell you differently.”
“Zero hours workers are not second class workers. They have the right to be treated fairly and with respect. They have the right to take holidays and to be paid when they take them. They have the right to statutory sick pay.
“They have a right to request guaranteed hours. Sports Direct will now have to make that crystal clear to staff. By doing so the risk of those rights being ignored or misunderstood by managers will be significantly reduced in the future.”
Campaigners have vowed to continue pushing for Sports Direct to scrap using the contracts, which are also used by McDonalds, Burger King franchisees, Wetherspoons and Domino’s Pizza.
Labour MP Alison McGovern, who has campaigned on the issue welcomed the decision, but added: “It is hard to understand why Sports Direct are so determined not to give people regular hours. What have they got against people knowing what money they can expect at the end of the week? That can’t be good for anyone.”
The Government is planning on banning the use of zero hours contracts with exclusivity clauses, which stop staff working anywhere else despite having no guaranteed work, while the Labour Party has said it will give greater rights to staff who have been on the contracts for longer than six months.
Last week at the Small Business Bill Committee the Government suggested that there was a link between the high usage of zero hours contracts and workers’ pay remaining low.
Treasury minister Andrea Leadsom said: “If we see a reduction in zero-hours contracts and people are employed on better contracts where they have regular hours, we expect we will see a change in the Exchequer’s share of employment taxes.”
A spokesman for Sports Direct added: “Sports Direct confirms that we have reached a settlement with Ms Gabriel-Abraham. The settlement is without any admission of any liability on the part of Sports Direct whatsoever.
"It was clear from the proceedings that we and Ms Gabriel-Abraham felt equally strongly about our respective positions and that each had different perceptions of the events that took place.
"The company will continue the process of reviewing, updating and improving our core employment documents and procedures across our entire business beyond its existing compliant framework.”Reuse content