UNDER-FIRE retailer Sports Direct International has pledged to pay its employees above the national minimum wage from today, in a move which will cost the company £10 million.
The group, controlled by retail billionaire Mike Ashley, who also owns Newcastle United football club, said it will apply to casual workers as well as all directly employed staff.
In a brief statement to the London Stock Exchange, the group said: “Sports Direct International plc today announces that it has made a commitment that its directly employed UK employees and directly engaged casual workers will be paid above the National Minimum Wage from 1 January 2016.
“The cost in relation to these direct employees and casual workers and other related costs and knock on costs are likely to be circa £10m on an annualised basis.”
It 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 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 has 400 UK stores, as a “bad advert for British business”.
Business Minister Nick Boles had said HM Revenue and Customs could take enforcement action over the non-payment of the national minimum wage.
The Guardian sent undercover reporters to work at Sports Direct’s warehouse in Shirebrook, Derbyshire, last month and alleged that the group was 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 said staff were harangued through a public address tannoy system for not working fast enough, a claim denied categorically by Sports Direct.