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Sports Direct boss vows to pay staff more than national minimum wage

By John Mulgrew and PA

Published 01/01/2016

Sports Direct majority shareholder Mike Ashley
Sports Direct majority shareholder Mike Ashley

Budget leisurewear chain Sports Direct - which is expanding in Northern Ireland - has pledged to pay its employees above the national minimum wage from January 1, in a move which will cost the firm £10m.

The group - which is controlled by Newcastle United FC billionaire owner Mike Ashley - said it will apply to casual workers as well as all of its directly employed staff.

In November, the Belfast Telegraph revealed that Mr Ashley had bought Donegall Arcade in the heart of the city, and is set to open his first city centre branch of Sports Direct.

It is understood rival retailer Lifestyle Sports had been due to take over the Currys store before the sale of the building.

It is Mr Ashley's first major property deal in Northern Ireland, though in October it emerged he was on course to take over Irish discount department store Heatons, which has 10 stores across the region.

While the property agents behind the sale, Lambert Smith Hampton, would not reveal how much Donegall Arcade had gone for, one expert said it would "be in excess of £10m".

Sports Direct operates a handful of stores in Northern Ireland, including two in Belfast, and in Newtownabbey, Bangor and Coleraine.

Now, the latest issue around pay comes after the company faced allegations from the Guardian newspaper earlier this month about low wages, and claims that it forces compulsory unpaid 15-minute searches of staff as they leave, while also docking wages for clocking in just one minute late.

The probe prompted condemnation from the Unite union, which called the atmosphere at Sports Direct "gulag working conditions". Senior Labour MP Chuka Umunna described the retailer, which runs around 400 stores across the UK, as a "bad advert for British business". Business Minister Nick Boles said HMRC could take enforcement action over the non-payment of the national minimum wage at the business. The Guardian sent undercover reporters to work at Sports Direct's warehouse in Shirebrook, Derbyshire, last month and alleged that the group is so concerned about potential theft that it even asks staff to roll up their trouser legs and show the top of their underwear as part of compulsory searches. The investigation also alleged staff are harangued by a public address system for not working fast enough.

Earlier this month Sports Direct posted half-year results showing a 3.6% rise in underlying pre-tax profits to £166.4m for the six months to October 25.

This latest controversy follows a storm of protest from trade unions over staff treatment at the group's annual shareholder meeting in September, when claims over staff searches first emerged.

Mike Ashley - who is said to be worth more than £3bn - has said he is personally launching a review of the retailer's employment practices.

His fortune is spread across his retail empire, along with his stake in Newcastle United.

Belfast Telegraph

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