Mike Ashley's Sports Direct 'could face Government action over wage claims'

He was replying to an urgent question from senior Labour MP Chuka Umunna, who described the company as a "bad advert for British business".

Commons Speaker John Bercow also revealed that the Treasury attempted to block Mr Umunna's question, judging the matter was not urgent.

But after the Treasury was overruled by Mr Bercow, Mr Boles said in reply to backbenchers: "I think I have been clear that obviously if any individual complaint is going to be assessed for its validity it does need to be possible for HMRC to follow it up.

"But I have also been clear that HMRC undertake targeted enforcement activity which doesn't wait for a complaint in sectors of concern.

"And they will be listening to this debate."

Sports Direct, which is controlled by Newcastle United owner Mike Ashley, faces allegations in The Guardian newspaper that it forces compulsory unpaid searches taking around 15 minutes on staff as they leave, while also docking wages for clocking in just one minute late.

Mr Umunna asked whether such practices were legal under minimum wage law, adding: "We know enough about the practices of Sports Direct plc, which has a branch in my constituency, to conclude that this company is a bad advert for British business and one with a culture of fear in the workplace which we would not wish to see repeated elsewhere.

"As the Institute of Directors said, it is a scar on British business."

He also revealed that employees were too afraid of losing their jobs to complain to HMRC.

Mr Umunna said: "Many of them, all of them, are refusing to come forward in the warehouses concerned for fear of the repercussions that follow.

"Why can HMRC not go ahead and carry out an investigation in this case which surely will render other evidence without workers being required to put their necks on the line?"

He went on: "No doubt the action of the employer concerned in this case will be to say we complied with the law, but surely what they need to understand is actually the British public expect a lot more from them.

"We often don't do things that we're allowed to do by the law because we don't think that is the right way in treating our fellow citizens and surely that should apply to the company in this case."

Replying, Mr Boles said the minimum expected of employers was that they comply with the law but that large companies like Sports Direct should also be "good citizens".

He said: "Obeying the law is the minimum we expect of employers.

"We expect employers to behave responsibly and to be good citizens and we would hope that they would not be satisfied just with obeying the law, that they would want to go a great deal further and I know that employers who are large and profitable in a sense, our expectations of their behaviour is even greater than that of the others."

On the question of whether undertaking time consuming but unpaid body searches on site at the Sports Direct warehouse was legal, Mr Boles said: "This is an intensely vexed legal question, and as a former employment law practitioner you will know how much time this is taking up of your former colleagues.

"I can't give an absolute pronouncement but what I can say is that anything that counts as work, as part of somebody's employment contract, must be compensated at least at the level of minimum wage.

"So the question is whether that search counts as work as part of their employment contract and that is a position that can be explored legally."

On allegations that workers are docked 15 minutes' wages for being a minute late to work, Mr Boles said they must still be paid at minimum wage: "The minimum wage legislation will apply to the 14 minutes as well as the rest of time that people are working so that therefore they cannot be not compensated for those 14 minutes if that would bring their overall wage rate down below the national minimum wage."

Labour veteran Dennis Skinner described Mr Ashley as a "monster of a man" as he addressed the concerns about the Shirebrook warehouse in his constituency.

The Bolsover MP said: "I don't think you should expect any social responsibility from the man that controls Sports Direct in my constituency at the warehouse at Shirebrook on a pit site.

"That man has not made £6 billion because he is a considerate employer.

"He is a monster of a man that doesn't even reply to MPs' letters - I've sent him many.

"He's got £6 billion and is on the Sunday Times Rich List because he's the type of man that will not take any notice of HMRC unless this Government really means business.

"This man Mike Ashley would fit very nicely on millionaire's row along with his pals so this will be a test of the minister's mettle.

"Get stuck in".

The Guardian sent undercover reporters to work at Sports Direct's warehouse in Shirebrook, Derbyshire, last month and last week alleged the company is so concerned about potential theft that it asks staff to roll up their trouser legs and show the top of their underwear as part of compulsory searches.

The expose also said staff are harangued by a public address system for not working fast enough.

It followed a storm of protest from trade unions at the group's annual shareholder meeting in September, when claims over staff searches first emerged.

The latest controversy came as Sports Direct posted half-year results showing a 3.6% rise in underlying pre-tax profits for the six months to October 25.

Mr Bercow revealed the Treasury felt the matter should not be the subject of an urgent question in the Commons but that he overruled the Government to allow the issue to be debated by MPs.

Turning to Mr Boles, he said: "I'm glad that you graciously welcomed the urgent question but unfortunately the Treasury wrote to me this morning to say that the matter wasn't urgent and shouldn't be aired.

"I concluded upon examination that it was and should and we look forward, very much I think, to the exchanges."