Sports Direct challenged by MPs over claims it underpays couriers

The Guardian - 15 Sep 2017

MPs on two parliamentary select committees have challenged Sports Direct over claims it is deliberately under-paying couriers by mislabeling heavy items, including bicycles, as lightweight packets to avoid paying the fair delivery cost.

Frank Field, Labour MP and chair of the Commons work and pensions select committee, said he had written to Mike Ashley, the billionaire Sports Direct founder, to demand answers following concerns raised by a whistleblower at delivery company Hermes.

Hermes “categorically” denied the allegations, saying: “We have stringent processes in place to check that parcels are not mislabelled and placed in the wrong weight category.”

Field said: “In the last parliament we heard egregious examples of companies using an essentially bogus classification of self-employment to shirk their responsibilities to those who work for them.

“If this complaint stands up, it represents a new low in actually deliberately under-paying workers for the work they do. We look forward to a speedy response and if there is merit in these claims, an immediate change in working practices and proper compensation for workers who have been subjected to this.”

Rachel Reeves, the Labour MP and chair-elect of the business, energy and industrial strategy committee, said it appeared there could be a “stitch-up between Hermes and Sports Direct to short-change low-paid couriers in order to boost company profits”.

“It’s deeply concerning to hear reports that the paying of couriers at an artificially low rate could be a persistent practice in arrangements between these two companies,” Reeves said. “If we can’t rely on company boards and shareholders to stop these sorts of unethical practices, then tougher enforcement measures will need to be considered by the government and parliament.”

Field, who has led campaigns in parliament against what he claims is the “sulphurous effect” of the fast-growing gig economy, said the whistleblower claimed that Sports Direct was the most persistent company in mislabelling delivery items. Last year MPs accused Ashley of running Sports Direct like a Victorian workhouse following a Guardian undercover investigation of conditions at its Shirebrook facility.

Sports Direct is alleged to regularly dispatch heavy parcels to Hermes drivers labelled as “packets”, a classification meant for small items that weigh less than a kilogram. In recent examples, the whistleblower alleged, a bicycle and a parcel weighing over 10kg were sent as packets. The whistleblower claimed Sport Direct “almost always sends parcels through as packets”.

Hermes pays its drivers a higher rate for heavier items, which are classified as parcels. Field said that rates on Hermes’ website suggest that labelling a 10kg parcel as a “packet” rather than a “parcel” would save the company £7.20.

Hermes said: “We categorically deny these allegations and are happy to answer any questions raised. We have stringent processes in place to check that parcels are not mislabelled and placed in the wrong weight category.

“On the rare occasion of an individual label being incorrect, couriers can immediately call our dedicated courier support team, to notify us and change their payment with no questions asked. This applies to all our clients and ensures that both Hermes and our couriers receive the correct payment. We have no issues with Sports Direct who remain a valued customer.

“This year we have invested heavily in pay increases for our couriers, who now get paid a minimum of £8.50 per hour and an average of £11 per hour after expenses.”

Sports Direct did not immediately respond to requests for comment.

Rupert Neate, The Guardian