Sports Direct's Compliance with UK Employment Law: A Report

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EMPLOYMENT PRACTICES
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Table of contents
Introduction......................................................................................................................................2
The ways in which the law regulates business organisations..........................................................2
Evaluate workplace legislation drawing examples from the recent case of Sports Direct..............4
Conclusion.......................................................................................................................................5
References........................................................................................................................................6
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Introduction
In all business organisations, it is necessary to comply with local, state and federal rules and
regulations controlled by the legislative bodies for operating legally. Some rules and regulations
can make an impact on the business operation. For any kind of organisation and industry, there
must be government regulation on the business to go alongside. Organisational rules and
regulations refer to the ways through which a business can be formed under the laws of state and
country. Business can also be built as limited liability companies (LLCs), partnerships and other
forms. The secret to identifying government laws on the business operation is to know where to
look and what kind of rules and regulations to look for. Hence, the present study focuses upon
the organization of Sports Direct International Plc. that is one of the leading sporting retail
organisations in the United Kingdom. The company is headquartered in Shire brook, Derbyshire
along with its warehouses.
The ways in which the law regulates business organisations
Business laws and regulations of the government depend on different categories. Each of them
might not have the same impact on the business operation. All the categories might not be a huge
concern for the business operation. Hence, it is necessary for the organisations to ensure that a
company is within an agreement regarding all the business laws with the same level of attention
and importance. For this, business lawyer can help an organisation to figure out the appropriate
laws that is applicable for the business operation (Peng, 2016).
There are some ways through which, the laws based on the concerned organization regulates its
organizational structure. These laws are mentioned below:
Tax Code Law
Government rules and regulations on the business operation always begin with the taxes. Every
organisation that is registered with the United Kingdom needs to pay the federal taxes (Martínez-
Sanz et al., 2017). Most of the organisations also need to pay the state taxes, depending on the
state where the organisations are registered. These taxes are unavoidable. These taxes are Income
tax, Employment tax and Excise tax.
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Most business organisations files, an annual income tax return (Besley, 2015). The organisations
pay income tax as per their earning and file the tax return in the end of the year. Moreover,
organisations need to pay the taxes which are related for comprising the employees on their
payroll and that is called employment tax. These include Medicare and security taxes, federal
unemployment tax and many more that are considered by the particular organization. Excise
taxes are generally paid when a business organisation purchases on goods. An organisation can
be under excise tax law if it manufactures or sells specific goods, uses several kinds of materials
and equipments, and receives payment for the providing services and many more.
Labour and Employment Law
There are many rules and regulations on the business operations that are administered by the
government bodies. Hence, the respective organization is known to employ workers and obey the
state and federal labour and employment law. According to the Department of Labour, the Fair
Labour Standard Act (FLSA) prescribes the wages structure and the pay of overtime (Sadgrove,
2016). This act can affect most public and private employment and it is required for the
employers to pay at least minimum federal wages and overtime pay. The organisations need to
abide by the law of equality in the time of hiring and promotion. Gender, religion, age, caste and
race are not allowed to make any influence at the time of hiring and promotion.
Advertising Law
The organisations need to make proper advertising strategies for the development of its business.
At the same time, it is necessary to abide the advertising law. An organisation needs to ensure
that their advertisements of the products are truthful (Kalokairinou et al., 2018). For instance,
there are some ways to implement that law that are followed within the present organization.
These are,
● To comply with the labelling law for the consumer products this means that ingredients
and chemicals should be listed within the specific product.
● To become aware of proper rules for advertising and selling the products through the
internet.
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Evaluate workplace legislation drawing examples from the recent case of Sports Direct
Sports Direct has around 465 stores and outlets where there are almost 200 permanent
employees. There are over 3000 agency workers, who have been employed through two of the
agencies which are, The Best Connection and Transline Group. There are several categories of
employees in the organisation. Those who are working in the shops of Sports Direct, are on the
zero-hour contract and those who are working in the shops and the warehouses, are on permanent
contract.
Health and Safety Legislation
The act of Health and Safety (1974) is associated with regulations which ensure the health, safety
and welfare in workplace of all the employees (McKelvey, 2015). This is required for the
employers to make sure that they abide this act by providing their employees with the safety for
the working hours.
The management of Sports Direct has identified some disturbing factors regarding health and
safety conditions at Sport Direct shop and as well as at the warehouses. From 1st January 2013 to
19th April 2016, total of 110 paramedic cars or ambulances has been dispatched to the
warehouse’s postcode and 50 cases has been classified as life-threatening, including breathing
problem and chest pain, convulsions, strokes. Five women had suffered from pregnancy
difficulties, including one who gave birth in the warehouse’s toilet. From 1st January 2010 to
19th April 2016, 115 accidents has been occurred, including a fractured neck, crushed hand,
amputation of a finger and several head, back, wrist injuries. 79 injuries has lead to the absences
from work for more than seven days. These are the major concern for the organisation. The
organisation has made a review on the health and safety provisions to ensure that the employees’
are not put in risk.
National minimum wage Legislation
The organisation needs to ensure that the employees are paid at the national minimum wage rate
in respect with the hours during their work period (Meyer, 2016). In the end of each work shift,
workers are searched, to prevent goods and materials being stolen from the warehouses.
Employees did not get the payment when they were being searched. That means the national
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minimum wage rate was not being followed by the management at the time of payment.
Employees have been deducted 15 minutes’ pay for being late of just one minute on the time of
arrival or on the return from break. Management has seriously looked after this case and made a
review. However, the system has been changed. Now, if an employee comes late by four
minutes, five minutes of payment are going to be deducted. This may lead to a position where
the employees can be able to work without suffering any wage penalty.
Conclusion
From above discussion, it is identified that there are certain laws which are administered by the
government. The organisations should obey all these rules for their business operation. As a
leading retail organisation in UK, Sports Direct has also some legislation in its business
operation. The issues in Health and safety, national minimum wage legislation, deduction of pay
and many more has affected the business of the organisation. However, the management has
made strong decisions to rectify these issues.
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References
Besley, T., 2015. Law, regulation, and the business climate: The nature and influence of the
World Bank Doing Business project. Journal of Economic Perspectives, 29(3), pp.99-120.
Kalokairinou, L., Howard, H.C., Slokenberga, S., Fisher, E., Flatscher-Thöni, M., Hartlev, M.,
Van Hellemondt, R., Juškevičius, J., Kapelenska-Pregowska, J., Kováč, P. and Lovrečić, L.,
2018. Legislation of direct-to-consumer genetic testing in Europe: a fragmented regulatory
landscape. Journal of community genetics, 9(2), pp.117-132.
Martínez-Sanz, J., Sospedra, I., Baladía, E., Arranz, L., Ortiz-Moncada, R. and Gil-Izquierdo, A.,
2017. Current status of legislation on dietary products for sportspeople in a European
framework. Nutrients, 9(11), p.1225.
McKelvey, S. and Longley, N., 2015. Event-specific ambush marketing legislation for mega-
sporting events: an economics perspective. International Journal of Sports Marketing and
Sponsorship, 16(5), pp.20-35.
Meyer, K. and Peng, M.W., 2016. International business. Cengage Learning.
Peng, M.W., 2016. Global business. Cengage Learning.
Sadgrove, K., 2016. The complete guide to business risk management. Routledge.
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