Sports Direct asks law firm to lead a further review into labour conditions

Sports Direct asked law firm Reynolds Porter Chamberlain (RPC) on Tuesday to lead a further comprehensive review of working practices at the retailer.

The FTSE 250 listed company initially asked the law firm to investigate and review working practices at Sports Direct in the last 90 days, after an investigation by the Guardian in July uncovered that workers were on zero hours contracts were being paid less than minimum wage in its warehouse.

Its founder and largest shareholder, Mike Ashley also faced a grilling from MPs at a parliamentary select committee where they compared the retailer’s employment practices and conditions to a “Victorian workhouse”.

Sports Direct said on Tuesday it had received the initial report, but requested a further comprehensive review, which will include examining the company's corporate governance and was take place over the next 12 months with results due out in 2017.

The company also said it would engage with shareholders to obtain their views.

Chairman Keith Hellawell was facing a revolt at the next board meeting on 28 September as three pension funds said on 2 September they planned to support a trade union-backed motion to block his re-election to the board.

They also called for an independent review of workplace practices at Sports Direct as they did not regard the initial review by RPC as independent.

The three pension funds, which own less than 1% between them, said they would also vote against the reappointment of the auditor Grant Thornton, chief executive Matthew Pearson and non-executive director Simon Bentley, the latter of which headed the company’s audit committee.

Legal and General Investment Management said it would vote against the reappointment of Hellawell and all of the non-executive directors.

Aberdeen Asset Management also said it would vote against Hellawell, Forsey and Pearson.