HRM Analysis: Challenges and Solutions for Sports Direct

This report provides a detailed analysis of Human Resource Management (HRM) practices at Sports Direct, UK. It begins by identifying two key people management issues: unfair wages, unethical workplace practices, and racial discrimination. The report then explores how a functional HR department can proactively manage these challenges through negotiation with employee unions, improved communication channels, and the implementation of employee welfare policies. The report outlines a viable HR planning process for Sports Direct, addressing organizational objectives, employee needs, and manpower gaps. Furthermore, it suggests a developmental activity, specifically training in convincing skills, conflict resolution, and workforce collaboration, to enhance employee performance. Finally, the report discusses the implications of employment legislation on Sports Direct's current practices, offering a comprehensive overview of HRM challenges and potential solutions.

Running head: INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
Introduction to Human Resource Management
Name of the Student
Name of the University
Author Note

1INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
Table of Content
Introduction......................................................................................................................................3
Task 1:.............................................................................................................................................3
Two people management issues Sport Direct is currently facing and discussing how functional
HR department can proactively manage them effectively...............................................................3
Task 2:.............................................................................................................................................5
Outlining with example how HR department within Sports Direct can successfully implement a
viable HR planning process.............................................................................................................5
Task 3:.............................................................................................................................................9
One developmental activity a functional HR department within Sports Direct can implement to
effectively enhance employee performance -500 words.................................................................9
Task 4:...........................................................................................................................................11
Implication of employment legislation on the current practices of Sports Direct -.......................11
Conclusion and Recommendation.................................................................................................13

2INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
Introduction
This report provides a detailed analysis of HR practices at Sports Direct, UK. The
success of an organization widely depends on its Human Resource Management, as it plays a
crucial role in meeting the organizational objectives. HRM is a significant organizational
function, which usually deals with the issues related to people; particularly in the section of
performance management, benefit, employee motivation, safety, communication, compensation
and in some other related areas. The present report identifies the challenges in these sections at
Sports Direct. The purpose of the report is to identify the challenges in the current HR
department and develop solutions about how a functional HR department can resolve the current
HR issues experienced by Sports Direct.
Task 1:
Two people management issues Sport Direct is currently facing and discussing how
functional HR department can proactively manage them effectively
The case study on Sports Direct implies that even though SD (Sports Direct) achieved a
tremendous growth in the business expanding in Europe and UK, the performance of the firm is
on the fragile stage, due to series of allegation regarding unfair wages, unethical workplace,
unpaid time taken and penalizing ill staff. Another significant issue found in Sport Direct’s work
practice is the racial discrimination at the workplace, where a staff claims that SD is prohibiting
them to speak Welsh language, as company’s official language is English. These issues are vital
to managerial practices in Sport Direct, as although the organization has a competitive position
in the market, employees’ dissatisfaction and improper HR practices would take no time to pull

3INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
the organization down to its toe. This is because human resource is the backbone of any
organization (Kitching and Smallbone 2012).Thus, discrepancies in the HR department in a large
organization like Sports Direct could be a “corporate shame”, which certainly tarnishes the
public image of the brand and further leading to loss of loyal customers.
The case study clearly indicates that employment relation at Sport Direct has to be
developed with an extending focus, as the above-mentioned issues are associated with the
workforce only. Thus, being in functional HR department, HR heads of Sport Direct needs to
come into the discussion with employee union considering two significant variables-
employment relation and welfare management. Sports Direct, in order to strengthen
employment relation and welfare policies, should negotiate with employee union heads, where
the needs and demands of two parties would be discussed. More specifically, the management
needs to involve the union heads; so that whenever a new HR policy is formed, it can
immediately be conveyed to the employees through union heads. The issues presented above
imply that there is a lack of communication between HR management and employees.
Consequently, employees’ needs are unheard and there is a robotic culture at the workplace,
where employees only follow the commands of management. Moreover, due to the layers of
management in Sports Direct, workers find it difficult to approach the management for sharing
their views. However, it is not easy for management to reach 18000 employees individually to
hear them.
Thus, organization needs a convenient channel- which union, approved by both HR
department and employees. Whenever, an employee encounters a workplace challenge, he/she
can directly contact the union leader to pass the message to the management. Likewise,
whenever a new policy is formed by management - such as the incentives for additional hours

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should be conveyed to the employees through the union leaders. Similarly, employee welfare
policies such as healthy workplace, earned leaves, health benefits should be formed considering
employee’s opinions. On the other side, union leaders also have to agree with management’s
policies such as additional efforts during seasonal holidays when the customers crowd at the
mall. Furthermore, for the compliance to policies regulations, HR department has to aware of
employee responses and this can be done through communication channels (Guest 2011). Here,
the role HR department is to form policies and regulations in a document and share the handouts
to the workers.
Task 2:
Outlining with example how HR department within Sports Direct can successfully
implement a viable HR planning process
Analyzing organizational objectives: Among several business objectives in Sports
Direct, the major objective is to invest in its people as well as significant third party brand
partners to lift up its retail proposition to achieve a new level of growth and excellence across its
multi-brands delivering to customers. However, Alfes et al. (2013) mentioned investment is not
the only solution to the workforce issues occurred to Sports Direct, as objectives of the
investment are not linked to its current workplace situations. Organizational objectives must
include the human resource needs. Maslow’s hierarchy of needs theory discussed below helps
to understand how the growing staffing needs can be met.
Biological and physiological needs: In order to take care of the basic needs of employee
such as food, water and shelter, HR department of the firm should look after whether the

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employees are having their lunch on time, whether there is an available water supply for drinking
for workers.
Safety needs: According to Maslow, safety needs may include physical, environmental,
emotional safety and protection (Sadri and Bowen 2011). HR department of SD needs to ensure
that employees have workplace safety- such as when an employee is ill during the work hours,
he/she is provided with appropriate medication or an emergency shift to hospital. In addition, if
a fire is observed in the building, the human resource department needs to make sure that all
employees are evacuated safely from the building.
Figure 1: Maslow’s hierarchy of needs
(Source: Sadri and Bowen 2011)

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Social needs: To take care of social needs such as love, affection, care, belongingness
and friendship, HR department needs to make sure that there is healthy and friendly relationship
between the supervisors and employees (Crook et al. 2011). This is important, as a friendly
relation between supervisors and subordinates further leads to the practice of open
communication, where employees directly come up to supervisors and share their concern.
Esteem needs: Esteem needs include respect, achievement, recognition and attention. A
functional HR department of Sports Direct needs to supervise whether its employees receive
appropriate recognition for their achievement. HR manager should praise and reward employees
for their achievement of performance.
Self- actualization needs: This need may include the urge to become the person what
they are actually capable of becoming (Jerome 2013). This means based on talent and skills, the
employees should be provided appropriate career growth opportunities.
Inventory of present human resource: As per the case study given, Sports Direct is said
to be one of the largest clothing retail shop with the largest workforce (18000 employees). Sports
Direct categorizes its overall workforce into several departments; here the departments are
determined on the basis of category of products it sells (Sparrow, Brewster and Chung 2016).
The department includes casual workers, people at the licensing group, people at the health and
safety committee, people at the wellbeing service, people at the retail trust and people at training
and development. Besides these departments, a mass number of people are hired as the sales
assistants, and people at the service quality improvement department. In addition, almost 298
people work in the IT department of the organization (Sportsdirectplc.com 2018).

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Forecasting demand and supply of human resource: The case study indicates that
Sports Direct has some significant workforce issues such as employee dissatisfaction caused by
unpaid work hours, racial discrimination and deduction of wages of employees falling sick.
Consequently, the percentage workforce turnover is increasing. As put forward by Nickson et al.
(2012) an individual working in the retail industry wish to grow their career in retail sector only.
Thus, the demand of human resource is higher but due to inappropriate work culture, the supply
would go down.
Estimate manpower gaps: Even though Sports Direct has a large workforce, the skills
and competencies are not equal in some of the departments. The brand is running the operation
in a global environment but it experiences a significant manpower gap as employee turnover rate
is increasing. To run the operation in branches successfully or expand the operation to all EEA
nations, the firm needs to recruit around 5000 people but it is forcefully managing the operation
with existing number of workforce; eventually, the situation leads to increased work pressure.
Formulation of human resource action plan:
Methods Identified issues Areas requiring
improvement
Monitoring Due to limited workforce,
Sports Direct is putting
additional pressure on workers
such as asking them to work
for extra hours, unpaid work
hours and wages deduction for
HR department needs to
review and design alternative
employment policies, which
helps to assign candidates as
per their skills and
capabilities. More specifically,

8INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
falling sick during work hours based on the capabilities,
employees should be assigned
with stipulated work hours.
Control It is certain that due to lack of
communication with the
management or supervisors,
employees violate the rules at
the workplace and go back to
their own habit of working
which may not be appropriate
A set of clear regulations and
policies should be formed to
control workforce under a
systematic and effective
culture.
Table 1: Action Plan
Task 3:
One developmental activity a functional HR department within Sports Direct can
implement to effectively enhance employee performance -500 words
Specified training activities: Due to the increased work pressure, employees’ work
practices are being hampered and the situation is leading to number of strikes and eventually,
employee performance is being hampered. To keep employee under control, Sports Direct needs
to develop suitable training activities such as convincing skills development, conflict
resolution program and workforce collaboration.
People convincing skills: Workers should be provided with the training on people
convincing skills. This means, for example, whenever a customer is not satisfied with the service

9INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
or he/she is having a query, quality service assistant needs to convince customer about the issue
about why and how it is occurred and how it would be resolved (Raffiee and Coff 2016). The
employees should be taught about the ways that such customer has to be approached in a
particular manner so that the person keeps hope that their brand is concerned about the issue. In
addition, the supervisor needs to collect frequent feedback from the employee such as the
updates about the context. So, the employee does not feel left alone.
Conflict resolution training: The employees should also be taught about how conflict in
the workplace can be resolved. Conflict can arise from both internal and external environment
(Halperin 2014). For example, if one of billing staffs is absent, the conflict can arise, as who
would take care of the billing counter that day. In such context, employees should have the
understanding that one has to take the responsibility to avoid unnecessary customer queue at the
counter. Through training and development session, employees’ understanding about the job
responsibilities should be increased.
Workforce collaboration: HR department has to build a cooperative culture among the
workers. For example, if one worker is observing a trouble in the computer at the billing counter,
another employee can help him/her out in resolving the issue instead of wasting time in waiting
for the IT employee to come.
Motivation activities: As discussed above, employee dissatisfaction occurs at Sport
Direct due to lack of motivational elements such as inadequate pay structure or unfair wages. To
resolve such issue, the HR department of Sports Direct needs to communicate with employee
union leaders who are aware of employee needs and industry’s pay structure. By negotiating
with the union leaders, the firm could come into an agreement of developing a pay structure that

10INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
is acceptable to both parties. For example, if £1000 is the overall remuneration budget, then,
almost 85% of the amount should be spent on salary, and 15% should be spent on benefits –such
as 7% on health benefit, 8% should be spent on reimbursement.
Other recognition and rewards programs: To motivate employees, Sport Direct could
develop an annual bonus plan, where they could reward employees by offering them a certain
amount of annual bonus, which should be an addition to the existing remuneration program.
Besides, the bonuses, the company could develop individual reward program, where each
employee for their individual achievement can be rewarded with certain amount of monetary or
non-monetary benefit. For example, Apple offers iPad, iPhone gadgets as reward to its
employees for their achievements (Gibson 2014). When it comes to employee recognition, Sport
Direct can develop few programs such as best seller of the month, best performer of the month
which should be reflected on their annual appraisal.
Task 4:
Implication of employment legislation on the current practices of Sports Direct -
Pay Related: The current pay structure at Sports Direct is not adequate enough compared
to New Wage Living (NLW) formed in April 2017 (Wills and Linneker 2014). According to the
principles of this new legislation, employer in retail industry is supposed to pay £7.50 an hour.
Now Sports Direct, who used to pay minimum wage for the non-managerial roles, will have to
decide to meet the additional costs of higher wage bill (Prowse and Fells 2016). On the other
side, according to the principles of National Minimum Wage, the employers must pay their
employees fairly based on the age and the type of work. According to the amendment in October,

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2011 workers and aged between 16 and 17 are entitled to receive £3.68 per hour and employees
aged between 18 and 20 are entitled to receive £4.98 per hour. According to these legislations,
the current pay structure at Sport Direct differs. According to BBC News (2018), minimum
wages rate at Sport Direct is lower than rate mentioned in National Minimum Wage legislation.
Consequently, Sport Direct has to pay back a total of £1.1 million to their workers.
Contracted Working times: According to Working Time Regulation (1998) amended
in 2007, an employee is entitled to annual leave in each year to a period of additional leave
determined in the legislation (Fahlén 2014). However, the case study indicates that Sports Direct
does not provide annual leaves to its employees; instead, their wages are deducted even for
accidental or medical leave. According to this amended legislations, the employees are not
supposed to work for long hours, especially in the retail sector. The principles also indicate that
employers do not cross the limit of 48 hours a week. Moreover, as per amended Working Time
Regulations, more shifts and part-time working should be implemented or introduced to
minimize the long hours shift. However, people at Sport Direct work under two-work shifts-
morning and evening shift. At the time of Christmas in 2014, employers in Sports Direct had to
work for 11 hours a day under a single shift (Henly and Lambert 2014). This practice is certainly
against the amendments done in 2007 in Working Time Regulation.
On the contrary, Yu, Ramanathan and Nath (2014) mentioned that around 31 firms in
construction and engineering sector now have system of variable hours over a standard week,
which is known as “Min-Max” for the largest occupational group. Arguably, Triantafyllou
Cherrett and Browne (2014) mentioned that the major purpose for the changes in the working
time regulation was to increase flexibility and reduce costs. Nonetheless, in the case of Sport
Direct, inflexibility increases due to additional force for working extra hours for the newly

12INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
mentioned wages per hour. However, as the regulation, £7.50 an hour is the minimum wage that
employer has to pay for working in normal shift hours, which means the organization needs to
pay additional wages for the extra hours.
Conclusion and Recommendation
The above presented report indicates that Sport Direct, UK, in the recent time have
observed a set of workforce issues caused by unethical human resource practices. The issues are
effectively identified and stipulated solutions have been developed with employee motivation
theories. In order to develop an effective employment relation, the firm has been suggested to
develop an effective employment relationship where union leaders and functional heads of
human resource department would be involved and develop a mutual agreement. Likewise, other
discrepancies have been critically discussed in the report. However, Sports Direct strictly needs
to comply to the regulations of employment. In order to protect its corporate image, Sports
Direct needs to pay more attention to its workforce and apply the legislations appropriately to
avoid employment conflict.

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