MPs welcomes Sports Direct's Â£1million back pay pledge
In a deal struck with HMRC and Unite the union, the retailer will provide payments to thousands of warehouse workers dating back to May 2012, with some staff pocketing up to £1,000.
The under-fire firm, lambasted by MPs for its "Victorian" working practises, will deliver the payouts to agency staff and workers directly employed by Sports Direct at its Shirebrook warehouse in Derbyshire.
The move comes after Sports Direct boss Mike Ashley, who is also the owner of Newcastle United, told MPs from the Business Select Committee in June that staff were not paid during security searches at the end of their shift, meaning they took home less than the minimum wage.
The committee also found that warehouse staff were docked pay for being one minute late to work.
Unite the union said workers employed by Sports Direct and the employment agency The Best Connection will start receiving back pay in full by the end of this month.
Hartlepool Iain Wright MP, chairman of the Business, Innovation and Skills Committee, said: "In June, when Mike Ashley appeared before the committee, he admitted for the first time that workers at Sports Direct's Derbyshire warehouse were paid below the minimum wage. That is unacceptable.
"It has now been reported the company is acting to put this right. The back payments represent a lot of money, which employees should have received in the first place.
"While this is good news, working practices continue to be under the spotlight at Sports Direct.
"Mike Ashley will be updating us in the autumn on the steps he has taken to address the appalling practices that have been identified, and we will be checking that he is as good as his word."