Unions are urging Sports Direct to move agency workers onto permanent contracts after one of its employment agencies submitted court documents preparing it for insolvency.
Transline said it was close to securing inward investment, but lodged a “notice of intention of appointing administrators” – a device that notifies secured creditors there is a chance of an administration process while protecting the business from action by creditors for 10 working days.
The agency, along with another one called Best Connection, have been embroiled in the controversy over pay and working conditions at Sports Direct’s warehouse in Shirebrook, Derbyshire.
A Transline spokesman said: “The company has suffered as a result of a continued move to tighter margins in the recruitment industry.
“We are close to securing inward investment that will allow us to drive forward with continued growth and infrastructure development, and have lodged the Notice of Intention to protect the business, our employees and our customers as we complete this process.
“The welfare of our staff and our relationships with our customers are of paramount importance and we are continuing our service and operations as normal. We expect to hear more regarding potential trading investments imminently.”
Two major workers unions have said the uncertainty of Transline’s futures means Sports Direct needs to stop relying on temporary agency workers at its Shirebrook warehouse.
Unite assistant general secretary Steve Turner said: “Sports Direct must urgently move to put agency workers onto permanent contracts to bring security to the workforce and certainty to the business.
“Transline must not be allowed to dodge its responsibilities or the back pay it owes for non-payment of the minimum wage at Sports Direct.
“It must continue to pay the wages of the tens of thousands of low-paid agency workers it currently employs across the UK.
“A failure to do so would be the final insult for the many workers it has exploited through its draconian work practices.”
Neil Derrick of the GMB said Transline had been the “ugly face of the gig economy” in recent years.
“They were the agency supplying workers to Sports Direct, they were sacked by Amazon and they are still supplying casual workers to Asos in Barnsley,” he said.
“Let’s hope the business model of making a quick buck on the back of hiring and firing people looking for work dies with them.
“What workers really need is the hope of secure employment and certainty of income.”