Sports Direct's mea culpa over working practices has serious shortcomings

Chief executive Dave Forsey is tagged as the fall guy, but he's still around. And would a truly independent review have turned out like this one? 

James Moore
Tuesday 06 September 2016 17:21
Workers at Sports Direct's warehouse at Shirebrook in Derbyshire
Workers at Sports Direct's warehouse at Shirebrook in Derbyshire

We’re terribly concerned about our workers, but you have to look at the big picture. We were growing really, really fast. Lots of the bad policies were down to the employment agencies we used. That dastardly Dave Forsey didn’t do his job properly.

Yes Sports Direct has published the hotly anticipated report into working conditions at the company, prepared by one of its law firms, RPC. Dastardly Dave is fingered as the fall guy.

Dave, you may recall, is the chief executive of Sports Direct. In most companies the CEO runs the show. In this one the CEO often seems more like a COO – a chief operating officer.

COO's deal with the nuts and bolts while the real boss man – at Sports Direct that's executive deputy chairman Mike Ashley – looks at the bigger picture. So it's Mr Forsey's fault.

The company's deficient human resources function that led staff to be treated in an inhuman manner? The board had delegated the management of it to Dave Forsey (P26).

Dealings with the controversial employment agencies supplying the majority of staff at Shirebrook? Ultimately "the responsibility of Dave Forsey", who apparently didn’t realise that it might have been a good idea to have contracts in place with them given the importance of the role they were playing in Sports Direct's business.

The fact that some workers’ take home pay was falling below the National Minimum Wage? “Mr Forsey had failed to inform the board (or Mr Ashley) of some of the issues … in a timely or effective manner over the course of a year or so.”(P26)

Weaknesses in the warehouse management structure? Have a guess. You've got it: “Mr Forsey openly acknowledges that his is ultimately responsible for the day to day running of the company and should have insisted on a stronger warehouse management structure.” (P26)

Mr Ashley does admit that he had “ultimate responsibility” but he just didn’t know what was going on.

So does this mean Mr Forsey gets the boot, as a warehouse picker who repeatedly mucked up orders or slacked while on the job, almost certainly would? Erm, no. But he is giving up his £3.6m bonus for a year. So that’s all right then.

Keep an eye on the Sports Direct remuneration report in future years. It will be most interesting to see what happens to to Mr Forsey’s pay going forward.

I doubt a fully independent review, called for by the Unite union in a motion submitted to the company's forthcoming AGM, would have done what this report frequently does. It often raises questions about the evidence against the company reported to the Parliamentary Business Information & Skills Committee, and by the media. It often seeks to provide excuses where failings are admitted. And if all else fails? It blames Dastardly Dave or the agencies, Transline and the Best Connection Group.

Still, you have to hope that things will at least start to get a bit better for Sports Direct's hard working and underappreciated workers. Up to a point.

We are told casual staff will be offered guaranteed hours instead of controversial zero hours contracts, if they want them. A nurse will be installed at Shirebrook in an attempt to cut the number of ambulance call outs. The six strikes policy that had workers living in fear for their jobs were they to rack up too many minor transgressions such as taking too long to go the loo? Scrapped.

The practice of calling out and humiliating alleged slackers over the Tannoy? The report only concedes there is anecdotal evidence for that happening, but we’re told it will be banned in future. So will the humiliating staff performance league tables, to be replaced by boards showing just the top workers. They will be rewarded with Sports Direct vouchers. You lucky people!

As for the 15 minute fines for turning up to work a minute late? Workers will only get fined five minutes pay now thanks to some tweaks to the sinister sounding Kronos computer system (where is Doctor Who when you need him?). Staff will also be allowed to leave a minute early to get back the unpaid time! You luck people! (2)

There will be strict enforcement of a zero tolerance policy towards sexual harassment, plus the creation of a confidential reporting system to deal with perhaps the darkest of the allegations aired before the BIS Committee. Investigations into this and other allegations are said to be ongoing and there will be a further report, again involving RPC.

As mea culpas go, however, the current 88-page report has shortcomings. And as I’ve said, Dastardly Dave is still around. As the person in charge of the day to day running of the business he will presumably be responsible for overseeing all the reforms Mr Ashley wants to see put in place. Oh dear.

Moreover, while the company says it will take on an increased number of agency workers as directly employed staff, those who remain with the agencies won’t receive the full-time offer. But negotiations will be held with the agencies to make things better for them too. So that’s all right then (2).

If nothing else, the scrutiny faced by Sports Direct ought at least to keep it honest for now. What the committee might want to look at in future are the other Shirebrooks up and down the country. One thing I do agree with report upon: I don’t think Sports Direct is alone.

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