HM Revenue and Customs is facing increasing calls from MPs to launch an inquiry into Sports Direct, as the sportswear retailer was branded a “bad advert for British business” in the House of Commons.

During a Commons debate, Nick Boles, a business minister, added to the pressure on HMRC by stressing that tax officials have the power to proactively investigate companies like Sports Direct if there is general concern about practices in the sector.

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The parliamentary debate was prompted by the Guardian’s investigation of working practices at the sportswear retailer.

Our undercover reporters found many agency workers for the firm effectively earn below the minimum wage because they typically have to wait for about 15 minutes after each shift to be searched by security staff. Whilst this time is unpaid, they also suffer harsh deductions for minor lateness.

An urgent question was then submitted by the former shadow business secretary Chuka Umunna, who asked why the tax authorities were not actively investigating the allegations.

He said a request for an investigation had been made by the union Unite, but HMRC said it could not act without direct complaints from workers, who are refusing to come forward for fear of losing their jobs.

“We know enough about the practices at Sports Direct Plc to conclude this company is a bad advert for British business and one with a culture of fear in the workplace, which we would not want to see repeated elsewhere,” he said. “Why cannot HMRC go ahead and carry out an investigation in this case?”

In response, Boles said HMRC can act proactively where there is a sector of concern and does not need necessarily to wait for a specific complaint.

He also praised the reporting in the case of Sports Direct, saying: “In general, I don’t often welcome an investigation by the Guardian newspaper, but in this case, I think it is absolutely vitally important that media organisations do investigate these things because the government is never going to be able to investigate every employer in the country. And if they can uncover things, then I can promise you the government will be sure to review their findings and enforce the law where necessary.”

Boles said he could not give an “absolute pronouncement” about some of the practices associated with Sports Direct but stressed that “anything that counts as work must be compensated at least at the level of the minimum wage”.

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In what appeared to be a warning to Sports Direct, which is run by billionaire businessman Mike Ashley, he said: “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. If they don’t obey the law, we will find them and disqualify directors if necessary.”

Despite the government’s response, the Treasury tried to block the debate by writing to the Speaker to say the matter was “not urgent and should not be aired”. This was overruled.



The minister was urged by Conservative and Labour MPs alike to look into practices like those of Sports Direct. Marcus Fysh, Tory MP for Yeovil, criticised the “aggressive use and attitude to flexible working” and called for ministers to consider a “general anti-avoidance rule when it comes to these employment laws”.

Previously, Sports Direct insisted it was “not operating Dickensian practices”, in the face of growing shareholder unrest. In response to criticism at a shareholder meeting, chair Keith Hellawell said he was “proud of the way [the] organisation operates”.