Sports Direct is facing battles on several fronts ahead of a crunch investor vote that could result in its under-fire chairman heading for the exit.
Twenty four hours before shareholders vote on Keith Hellawell’s future, dark clouds were gathering above its controversial Shirebrook warehouse amid opposition to his reappointment and new allegations relating to the retailer’s treatment of staff.
The Unite union claimed the company had reneged on a promise to offer workers on zero-hours contracts guaranteed hours – a pledge it had made following last year’s storm over its treatment of workers amid claims of “Victorian” conditions.
Image: The Sports Direct warehouse at Shirebrook was at the centre of the company’s working practices scandal
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Unite said it had seen job advertisements showing that Sports Direct had moved to hire casual labour on such “abusive” contracts.
The union’s assistant general secretary, Steve Turner, said: “This revelation shows it is ‘business as usual’ at Sports Direct and casts doubt on just how sincere it is about cleaning up its act.”
He added: “With the retailer advertising for casual workers in its Sports Direct and upmarket Flannels stores across the UK, it is clear this is no mistake, but a return to the bad old ways once the spotlight had gone away.”
Image: Mike Ashley admitted last year mistakes in Sports Direct’s handling of employees and agency staff
Sports Direct was yet to respond to a request for a statement by Sky News.
The accusation followed on from further criticism the union levelled against the firm recently, when it claimed staff feedback arrangements did not give anonymity.
Unite has said it is supporting institutional investors and shareholder advisory groups which are urging against the re-election of Mr Hellawell.
He has survived two previous votes in the past 12 months – thanks to chief executive Mike Ashley’s majority voting rights.
Image: Sports Direct chairman Keith Hellawell will quit without more support from minority shareholders
But Mr Hellawell, a former chief constable and Government drugs tsar, said in January he would quit the role if he did not secure support from a majority of independent shareholders at Wednesday’s AGM.
There is also some shareholder anger over Mr Ashley’s decision not to attend.
He has blamed “conflicting demands” on his time – potentially demonstrating a dire state of relations between investors and Mr Ashley at a time when the chain is battling falling profits and pressures from the Brexit-hit pound in addition to criticism of the way it works.
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While Phoenix Asset Management Partners and Aurora Investment Trust have signalled their intention to vote for Mr Hellawell’s reappointment, at least three other investors are going the other way.
Hermes, Royal London Asset Management and Standard Life Aberdeen said they were joining three shareholder advisory groups in taking a stand against its corporate governance standards.
Hermes, however, said it was welcome that Mr Ashley was now running the FTSE 250 company since the departure of its previous chief executive Dave Forsey.