Case Study: Analyzing HR Challenges at Sports Direct (HRM 101)

This case study analyzes the human resource management issues at Sports Direct, including problems related to wages, employee discrimination, and unethical recruitment practices. The report delves into the impact of low wages, untimely payments, and the use of zero-hour contracts on employee satisfaction and the company's market position. It examines instances of discrimination and proposes a zero-tolerance policy and open communication channels to address these issues. Furthermore, the study outlines an effective HR planning process, including organizational objective analysis, human resource inventory, forecasting, and action plan formulation to address staffing gaps and improve talent management. The report also emphasizes the importance of goal setting as a developmental activity and explores relevant employment legislations, particularly those concerning racial discrimination and pay and wages, to ensure legal compliance and ethical business practices. Recommendations are provided throughout to improve HR management and overall organizational performance.

Human resource management
Case study (Sports Direct)

Sports Direct Case Study 1
Contents
Introduction......................................................................................................................................2
Task 1: Two people management issues.........................................................................................2
Wages and payments....................................................................................................................2
Recommendation.........................................................................................................................2
Discrimination..............................................................................................................................3
Recommendation.........................................................................................................................3
Task 2: HR planning process...........................................................................................................3
Task 3: Developmental activity: Goal setting.................................................................................5
Task 4: Employment legislations.....................................................................................................6
Racial discrimination laws...........................................................................................................6
Race relations act 1965.............................................................................................................6
Equality act 2010......................................................................................................................6
Pay and Wages.............................................................................................................................7
United Kingdom labor law.......................................................................................................7
Conclusion and recommendations...................................................................................................8
References........................................................................................................................................9

Sports Direct Case Study 2
Introduction
Human resource management plays a vital role in the success of any business. There are various
roles played by the HR of any business including recruitment, selection, retention, employee
satisfaction, compensation and talent management (Hendry, 2012). The case has referred to
numerous issues faced by Sports Direct with reference to their HR management. The
organization has been accused of ill treatment of employees, unfair wages, lack of work life
balance, racial discrimination and unethical recruitment of employees in the business. This has
adversely impacted the organization’s goodwill and positioning in the market. Therefore, this
report throws light on specific issues faced by the organization along with recommendations to
fix the same. The report highlights key issues faced by the organization and its employees along
with a detailed HR plan that would enable the organization to analyze its recruitment needs
efficiently leading to better quality talent management.
Task 1: Two people management issues
Wages and payments
The first key people management issue faced by employees of Sports Direct are extremely low
wages and untimely payments made to them. Wages are often the primary factor influencing
employee satisfaction. Therefore it is the responsibility of every organization to ensure that their
workers are fairly and timely paid (Gupta & Shaw, 2014). Sports direct is facing issues of
underpaid labor as well as untimely payments. More often the workers’ salaries are deducted
through a rigorous check about workers leaving the warehouse. Workers have also been facing
issues like salary deductions if they spend too much time chatting, in the toilet or while catering
to a sick family members.
Recommendation
As an interim HR head, it is recommended that the organization must immediately work upon a
fresh payment policy for the employees that would include details of the amount paid, date of
salary disbursement and clear specifications of violations that might lead to salary deductions.
The HR department must also focus on eradicating zero work hour contracts and pay attention to
hiring full time employees through ethical sources. The salaries of all employees must live up to

Sports Direct Case Study 3
the industry standards (Cascio, 2018). Employee promotions, incentives, bonuses and salary
increment structures must also be specified in the report. Every employee must be provided with
a fixed number of holidays in the year besides sick leaves and casual leave. An effective,
practical and transparent leave policy must also be maintained and followed. A formal procedure
of requesting leaves by employees must be followed through chains of open communication.
Discrimination
Employee discrimination is a serious offense that must not be practiced in any organization.
Discrimination on the basis of sex, caste, creed, religion, language or race is strictly prohibited
(Sharma & Mann, 2018). Employees at Sports Direct have faced and reported multiple cases of
discrimination and ill treatment. Discrimination against employees leads to unfair or unequal
treatment leading to employee dissatisfaction. Such a behavior is unethical and largely
demotivating for employees (Barak, 2016). The case mentions of an incident where a Welsh
worker was forbidden to speak his local language within the office premises. Financial Times
quoted an employee of Sport Direct who stated that she was promised a promotion in return for
sexual favors.
Recommendation
In order to ensure equal treatment of employees, a zero tolerance policy must be created for the
organization which clearly specifies that any kind of discrimination against employees will not
be tolerated (Kivel, 2017). The organization must focus on open communication and transparent
communication within the business. The employees must be encouraged to report cases of
discrimination without any fear. Strict actions must be taken against reported cases on an
immediate basis. Open door policy can be adopted by the organization wherein the top
management of the company leave their doors open at all times to signify their availability for
the employees (Johnson, 2015). A legal body must be nominated within employees who would
address employee grievances at the earliest.
Task 2: HR planning process
An HR planning process ideally identifies the gap between the current manpower and the
required manpower in any business. There are various employees at Sports Direct who are

Sports Direct Case Study 4
working on Zero hour contracts. Zero hour contracts further add to employee dissatisfaction
(Hopkins & Fairfoul, 2014) Numerous employees are hired through unethical recruitment
sources. In order to fix this issue, the organization needs to bring about an effective HR planning
process in place. It is essential to plan this in order to ensure that at any given point of time, the
organization does not face a dearth or an excess of employees working for the business (Kerzner
& Kerzner, 2017). Sports Direct must adopt to the following process in order to effectively fill
the gap faced by their international staffing needs:
Step 1: Analyze organizational objectives: In this step, Sports Direct must evaluate the future
goals of different official departments and gain a deeper insight about the work that would be
done in the organization in the near future (Armstrong & Taylor, 2014). These objectives must
clarify a tentative plan for each department along with an approximate need of human resources
for the fulfillment of these objectives.
Step 2: Inventory of present human resources: The human resource data of the firm must be
gathered with details about the total number of currently working employees. This includes full
time employees, part time employees, zero hours contract employees as well as freelancers.
Step 3: Forecasting demand and supply of human resources: In this step, the human resources
required to fulfill the above analyzed objectives are taken into account (Banfield, Kay & Royles,
2018). Post that, an analysis is made of available candidates which would throw light on the
supply of resources.
Step 4: Estimating man power gaps: This supply of human resources would be matched with the
demand of human resources. The gap between the two will be identified giving a clear direction
to the flow of the HR planning process.
Step 5: Formulating the human resource action plan: The action plan depends upon whether the
supply or the demand is higher than the other. If there is an oversupply of human resources, then
a few employees would be terminated by giving an advance notice. If there is a shortage of
human resources then recruitment policies would be introduced and inter departmental transfers
would be encourage.

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Step 6: Monitor, control and feedback: This step ideally involves the implementation of the HR
action plan. Once the plan has been implemented, human resource inventories are updated and
monitored on a regular basis to understand the human resource management in the organization.
Human resource planning process must be implemented on an urgent basis at Sports Direct. This
would ensure that the human resource requirements are effectively and regularly met. This would
also discourage unethical sources of recruitment within the organization. It has been observed
that few people are running slave labors in the name of recruitment agencies. The frequent pay
cuts and lack of work life balance faced by employees are results of ineffective HR planning
process.
An effective HR planning process possesses the ability to address both tactical as well as
strategic needs of the organization (Shields & Brown, 2015). Talent management at the business
comes in handy with the implementation of a practical and effective HR planning process. This
eventually leads to employee satisfaction, lesser employee grievances and effective addressing of
these grievances as and when they arise.
Task 3: Developmental activity: Goal setting
One developmental activity that can be implemented effectively in order to improve the
performance of employees at Sports direct is ‘Goal Setting’. This theory allows the organization
to motivate employees to work hard by setting short term and long term goals for them (Miner,
2015). Achievement of goals and successful accomplishment of objectives motivates people to
work harder and move on to the next goal. Goal setting of employees at Sports Direct must be
elaborately conducted by the top management at the firm while take a view of all the employees.
The goals assigned to all the employees must be in overall coordination with organizational goals
(Lazaroiu, 2015).
It is also important to provide constructive feedback and monitor as well as evaluate employee’s
performance from time to time (Waweru, Kiambati & Simiyu, 2015). This performance review
must be done monthly by managers and quarterly by the top management. Goal setting theory
given by Edwin Locke also states that people who set difficult and challenging goals are more
likely to succeed then people who set easy goals. Keeping this theory in mind, the employees of

Sports Direct Case Study 6
Sports Direct must be pushed towards setting higher goals and motivated towards achieving
them. Goal setting of employees will not only boost employee performance but would also
formalize and organize the processes of the firm.
While setting goals for employees, it is essential to set SMART goals. These goals must be
specific so that employees know exactly what is expected out of them (David, 2016). The goals
must be measurable in order to evaluate the performance of employees. These goals must be
attainable because setting impractical goals will lead to employee demotivation as well as
hamper organizational performance. These goals must be realistic which allow the employees to
accomplish these. Lastly, the goals must be time bound. The labors and low level employees
could be given goals on a daily basis. While middle management could be allotted monthly goals
and finally the top management must aim to achieve quarterly and semiannual goals.
Along with setting practical goals which are aimed at fulfilling long term and short term
objectives, the employees must also be rewarded for accomplishment of goals or for exceeding
their targets. Rewards in the form of tangible or intangible benefits must be bestowed upon
employees in order to keep them motivated to work hard and fulfill these goals. Sports direct is
facing a lot of problems in terms of performance management of employees and therefore it is
imperative that the firm takes immediate steps towards fixing the same. Setting these goals will
help improve employee performance, achieve organizational goals and at the same time help the
top management in keeping a track of the performance of all the employees. Effective
management of the same would lead to improved performance and enhanced growth of Sports
Direct.
Task 4: Employment legislations
Laws of a particular country are basically rules that must be abided by the entities of the country
in order to ensure smooth functioning of the same. There are various rules that bide the
organizations of United Kingdom. These laws are necessary to protect the people of the business
as well as the organization from any form of harassment, risk, physical danger or discrimination.
Sports Direct is currently facing various issues and in the process violating various laws that the
company is governed by. Laws relating to racial discrimination and pay and wages of employees
are explained as below:

Sports Direct Case Study 7
Racial discrimination laws
Racial discrimination is a severe offense in the eyes of the law. The laws governing the country
and protecting people against the same are as below:
Race relations act 1965
This was the first legislation in the United Kingdom that addressed the issue of racial
discrimination. The act outlawed any kind of discrimination on the basis of color, race, creed,
caste, religion or ethnic origin. This act was then replaced by Race relations act of 1976
(Layton-Henry & Rich, 2016). The act also established a legal body ‘commission for racial
equality’.
Equality act 2010
Equality act 2010 of the United Kingdom is an act of the country’s parliament. The purpose of
the act is to codify numerous arrays of acts and regulations which are covered under the umbrella
of anti-discrimination law. One important aspect of the act protects people against discrimination
in employment against religion, sex, age, disability or race.
The above laws protect UK citizens from any kind of discrimination on the basis of caste, creed,
color, race, sex or disability. Sports Direct must consider these acts and must adhere to them.
Any violation of the same is considered an offense in the eyes of the UK government. The
employees must also be made aware of these acts so that they can take certain action when posed
with such discrimination.
Pay and Wages
Pay and wages of an employee are the employee’s rights. A lot of employee’s primary source of
motivation is the pay they receive. It is the duty of the employer to fairly pay all its employees. It
is also essential to ensure that all the employees performing the same task are eligible for equal
pay and there shall be no discrimination on the basis of caste, religion, sex or race. In order to
further protect the working class of the country, laws have been instituted to ensure that
employees certainly receive a minimum pay for their work. This minimum pay is defined hourly.
The laws binding UK organizations to fairly pay their employees are as below:

Sports Direct Case Study 8
United Kingdom labor law
The United Kingdom labor law essentially regulates the relations between workers, employers
and trade unions. There are various rights bestowed upon employees through this act including
Right to a minimum wage of € 7.50 for over 25 year olds under the National minimum wage
act of 1998. Post this, the national minimum wage regulation of 1999 elaborates the details of
how the minimum wage should be calculated. The law also states that every employee has the
right to avail 28 paid leaves during the year.
Sports direct has been known to deduct wages if an employee spends time on the phone, in the
toilet or even in chatting with peers. The law protects employees from such kind of a harassment.
The law states that if the employee answers phone calls but is in the vicinity of the workplace,
then that amount of time would be counted as ‘working hour’. Employees at Sports Direct face a
major issue of work life imbalance and it is imperative that these employees are educated about
these laws in order for them to claim their fair pay on a daily or monthly basis.
Conclusion and recommendations
Employee satisfaction is one of the most important aspect that must be taken care of by every
organization in business. Employee satisfaction is one of the key functions of HR (Chao & Kuo,
2015). This report throws light on various issues faced by the employees of Sports Direct
including Racial discrimination, unfair pay, work-life imbalance, zero hour contracts, various
forms of harassments and untimely payments.
The current working conditions of the employees at Sports Direct are worsening by the day and
it is high time that the organization puts some sincere efforts to resolve the same. This report
focuses on building a sustainable HR plan which would help the organization analyze their
Human resource needs and also assist the top management in adopting ethical sources of
recruitment.
It is also recommended that the organization adopts effective goal setting strategy in order to
motivate employees to work hard and achieve their objectives in the business. A practical and
efficient performance management strategy must also be adopted by Sports Direct to monitor
and evaluate the employee’s performance on a regular basis, provide them constructive feedback

Sports Direct Case Study 9
and assist them in improving their overall objectives. There are various laws that bind Sports
Direct. A clear understanding and in-depth study of these laws will not only improve employee
satisfaction but also assist in improved performance and goodwill of the organization.

Sports Direct Case Study 10
References
Armstrong, M. and Taylor, S., 2014. Armstrong's handbook of human resource management
practice. Kogan Page Publishers.
Banfield, P., Kay, R. and Royles, D., 2018. Introduction to human resource management.
Oxford University Press.
Cascio, W., 2018. Managing human resources. McGraw-Hill Education. New York.
Chao, M.C. and Kuo, C.W., 2015. Workplace stress, job satisfaction, job performance, and
turnover intention of health care workers in rural Taiwan. Asia Pacific Journal of Public
Health, 27(2), pp.NP1827-NP1836.
David, S., 2016. Beyond goals: Effective strategies for coaching and mentoring. Routledge.
United Kingdom.
Gupta, N. and Shaw, J.D., 2014. Employee compensation: The neglected area of HRM
research. Human Resource Management Review, 24(1), pp.1-4.
Hendry, C., 2012. Human resource management. Routledge. United Kingdom
Hopkins, L. and Fairfoul, H., 2014. Employer perspectives on ‘zero hours’ contracts in UK
higher education. Journal of Collective Bargaining in the Academy, (9), p.10.
Johnson, S.L., 2015. Workplace bullying prevention: a critical discourse analysis. Journal of
advanced nursing, 71(10), pp.2384-2392.
Kerzner, H. and Kerzner, H.R., 2017. Project management: a systems approach to planning,
scheduling, and controlling. John Wiley & Sons.
Kivel, P., 2017. Uprooting Racism-: How White People Can Work for Racial Justice. New
Society Publishers. United States.
Layton-Henry, Z. and Rich, P.B. eds., 2016. Race, Government and Politics in Britain. Springer.
Germany.

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Lazaroiu, G., 2015. Work motivation and organizational behavior. Contemporary Readings in
Law and Social Justice, 7(2), p.66. Addleton Academic Publishers. New York.
Miner, J.B., 2015. Organizational behavior 1: Essential theories of motivation and leadership.
Routledge. United Kingdom.
Sharma, S. and Mann, N., 2018. Workplace Discrimination: The Most Critical Issue
in. Management Techniques for a Diverse and Cross-Cultural Workforce, p.206.
Shields, J., Brown, 2015. Managing Employee Performance & Reward: Concepts, Practices,
and Strategies. Cambridge University Press.
Waweru, B.M., Kiambati, K. and Simiyu, A., 2015. Work Progress Feedback and Employees
Performance in Organizations: A Case Study of Water and Sanitation Companies in Nyeri
County, Kenya.