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Backlash over allegations firm is falling short of minimum wage obligations

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A national sportswear retailer drew heavy criticism in Parliament yesterday following allegations that the firm was failing to pay the minimum wage.

The FTSE 100 firm Sports Direct – which is controlled by the billionaire businessman and Newcastle FC chairman Mike Ashley – has attracted widespread condemnation following revelations that appeared in the Guardian last week.

The newspaper reported that staff at the firm’s main warehouse were subjected to prolonged security checks and that the process essentially meant that staff were earning less than the statutory minimum.

At the heart of the matter is that employees are not free to leave the premises until the searches at the end of a shift have been completed, meaning that the checks should be classed as “working time.”

Nick Boles, a minister in the department for Business Innovation and Skills, was summoned by Labour MP Chuka Umunna to answer questions on Sports Direct’s compliance with minimum wage laws.

Mr Boles insisted that any business which failed to meet its obligations would be swiftly brought to book.

“I don’t care how famous an employer is, I don’t care how well connected they are, I don’t care frankly how much money they have made, they need to obey the law,” he told the House of Commons.

“If they don’t obey the law we will enforce the law, we will fine them and disqualify the directors if necessary.”

Luke Primarolo, a regional officer at the trade union Unite, said: “HMRC needs to urgently investigate what looks like a breach of the minimum wage.

“The majority of these workers are on precarious agency contracts, which while not illegal, make it virtually impossible for them to challenge unfair treatment for fear of losing their job.”

Sports Direct said yesterday that it believed it was in compliance with legislation and said it took its responsibilities to pay the National Minimum Wage exceedingly seriously.