Sports Direct has handed £43m in share bonuses to a group of nearly 2,000 permanent staff who took part in an incentive scheme launched in 2011.
Mike Ashley, the majority shareholder and chief executive of the retail group, praised the “magnificent achievements and fantastic loyalty” of workers who were helping the company move towards becoming the “Selfridges of sport”.
Ashley said: “The people at Sports Direct deserve every penny of these bonuses.”
The company revealed the payout in a stock exchange announcement, which came days after chairman Keith Hellawell narrowly escaped being voted out by independent shareholders partly in response to poor treatment of workers under his stewardship.
Only just over 53% of independent investors backed his re-election on Wednesday as Hellawell defended Sports Direct’s use of zero-hours contracts and said there was no need for an independent review of its working practices. The retailer’s board pledged to tackle both issues a year ago.
A spokesman for Sports Direct said: “It our policy to treat all people at Sports Direct with dignity and respect and we will continue to make a positive difference.”
However, the generous share bonus scheme, which paid out this week, has also proved controversial as only a tiny proportion of the 29,000 people who work for Sports Direct are able to participate.
Applications for the scheme are limited to those directly employed on full contracts. Those on zero-hours contracts, including the vast majority of store staff, and those employed via agencies, as are most of those who work in Sports Direct’s Derbyshire warehouse at Shirebrook, cannot take part in the scheme.
Sports Direct does not have a current share bonus plan for staff after a planned scheme missed its targets.
The retailer said last year it would not be paying a bonus under a scheme set to mature in 2019 after underlying profits missed the company’s target of £420m. The bonus plan would have paid out £200m in shares to 3,000 permanent staff if earnings doubled by 2019. The company said it is developing a replacement scheme.
Sports Direct said it expects to pay other awards and incentives this year of about £19m, from which both permanent and casual staff can benefit.
