Mike Ashley’s Frasers insists it did not break furlough rules

Sports Direct was accused of asking furloughed managers to help with a spike in online orders

Mike Ashley’s retail empire Frasers has insisted it did not break the rules following claims that staff were encouraged to work while on the taxpayer-funded furlough scheme. 

Sports Direct was accused of asking some furloughed shop managers to shift stock from stores to depots at the peak of the crisis, after a spike in online orders.

But speaking at an annual meeting with investors, finance chief Chris Wootton said the firm is in regular contact with tax collector HMRC about its procedures and has followed regulations.

He said: “We appreciate this is a hot topic, but we have carried out internal procedures, external procedures, we liaise with HMRC regularly on the Coronavirus Job Retention Scheme, and we are very confident that we have followed the rules.

“Our books are open to anyone, including HMRC.”

The business declined to say how much money it accepted from the Government to put employees on temporary leave when branches were forced to shut during lockdown. Under the terms of the scheme, it is illegal for furloughed staff to continue working while receiving taxpayer-funded wages. 

Mr Ashley initially vowed to keep stores open despite an order in March to shut down, saying Sports Direct was vital to the nation's fitness. He quickly U-turned and apologised.

Shareholders approved a bonus programme for staff that could mean employees share £100m between them, with potential rewards of £50,000 to £500,000 each if they outperform. 

The so-called Fearless share award plan will pay out if Frasers stock hits £10 over the next four years and stays there for consecutive days. Shares were trading at £3.62 on Wednesday.

Frasers also plans to improve its efforts on being a more diverse and inclusive employer after criticism over the years for poor working conditions at its warehouse in Shirebrook, which MPs claimed was operated like a “Victorian workhouse” in 2016. 

Mr Wootton also warned that some House of Fraser stores that do not make enough money might close unless there were sweeping changes to the business rates system.