Workers at Sports Direct’s Shirebrook-based warehouse are to receive back pay amounting to an estimated £1 million to compensate for not being paid the national minimum wage.
The payments will be back dated to May 2012. The back pay will cover the additional time taken for unpaid staff searches at the end of shifts, which led to some employees being paid under the national minimum wage of £6.70 an hour for their time at work.
The back pay is expected to be delivered in full towards the end of August 2016 to staff directly employed by Sports Direct and workers provided by agency The Best Connection.
The back payments could be worth up to £1,000 for some workers, according to estimates by trade union Unite.
The back pay deal, secured by Unite, received the backing of 96% of Unite members who are directly employed by Sports Direct.
According to Unite, Transline, who also provides agency workers to the Sports Direct warehouse, may initially only pay half of the back pay owed to workers. The organisation took over from agency Blue Arrow at Shirebrook two years ago.
More than 3,000 agency workers at the Shirebrook site are contracted through agencies The Best Connection and Transline.
Mike Ashley, founder of Sports Direct, admitted that staff at the organisation’s Shirebrook warehouse were paid below the minimum wage at a Select Committee hearing in June.
In July, the Business, Innovation and Skills (BIS) Select Committee released a report into employment practices at Sports Direct, which includes concerns around pay deductions and outstanding back pay.
Steve Turner, assistant general secretary at Unite, said: “Mike Ashley and the Sports Direct board should be under no illusions. The charge of ‘Victorian’ work practices will continue to weigh heavily on Sports Direct until it moves long standing agency workers onto direct, permanent contracts and weans itself off its reliance upon zero hours contracts.”
A Transline spokesperson said: “We are making all payments required, in full compliance with HM Revenue and Customs”.
Sports Direct and The Best Connection had not responded to a request for comment at the time of publication.