Newcastle United sponsor, Wonga, the controversial payday lender, has reported a slump in profits as it counts the cost of a drive to clean up the image of the business.
Wonga said the 53 per cent slide in profits to £39.7m in 2013 was in part due to a one-off charge in relation to a recent scandal over fake legal letters, which were used in order to chase struggling customers into paying up.
The company said it expects that it will be “smaller and less profitable” in the near term while it builds a more sustainable business for the future.
Source – Northern Echo, 30 Sept 2014
Newcastle United owner Mike Ashley has today been accused of being the biggest employer to use the soon-to-be illegal “zero hour” contracts.
The billionaire’s Sports Direct empire is said to have up to 20,000 part-time staff on the contracts.
But MPs and campaigners say the use of zero hours contracts is “unfair and exploitative,” as workers having no guaranteed working hours and have to seek permission from management to work elsewhere.
A copy of a 2012 contract is reported to tell employees: “If you wish to undertake any work outside the company, whether paid or unpaid, you should raise the matter with your manager … it may be decided that the additional work would conflict with your duties at Sports Direct.com Retail Limited. You would then be prevented from taking it up.”
It is understood this clause remains in current contracts and does not give minimum guaranteed working hours. Campaigners have described the wording as an “exclusivity” clause although it is not known whether Sports Direct enforces the rule.
Labour MP Alison McGovern said: “This seems like ‘exclusivity’ in all but name to me. It is clearly exploitative and really unfair.”
> Alison McGovern is MP for Wirral South. What, no comment from Newcastle’s Labour MPs ?
A spokesman for the Department of Business, Innovation and Skills said zero hours contracts can benefit some workers because of the flexibility but that “unfortunately, it has become clear that some employers abuse this flexibility.”
The Government is seeking to ban such working conditions – which are also reportedly used by companies including McDonalds, Cineworld and Burger King.
Ministers estimate some 125,000 workers will benefit – meaning Sports Direct staff could account for almost one in six of the entire workforce the Government wants to help.
Sports Direct declined to comment.
Source – Newcastle Evening Chronicle, 12 Aug 2014
Labour MPs have increased the pressure on payday lenders Wonga to quit their Newcastle United shirt sponsorship deal – but the company say they are committed to the club.
The finance firm’s new chairman Andy Haste announced on Monday he would be reviewing the company’s advertising and marketing “to make sure that we don’t leave any impression that we are trying to influence or target the very young”.
But with thousands of junior Magpies fans wearing Wonga-sponsored shirts, some MPs said they hope he will end to Wonga’s partnership with NUFC.
A spokesman for Wonga said that its chairman had been asked a comment about Wonga’s marketing in general in the wake of the company’s decision to ditch its “puppet” advertising campaign, and had made no specific remarks regarding Newcastle United.
“We continue to be proud sponsors of Newcastle United FC,” she said. “Our new chairman, Andy Haste, was commenting on our general marketing approach – he did not make any direct comment on our sponsorship of the club.”
Gateshead Mp Ian Mearns said: “If Wonga express an interest in disassociating themselves because of a duty to young fans in their new business model then I’d hope Mike Ashley would let them out of their contract and find a new sponsor.
“But it will depend on what Wonga are contractually obliged to do in terms of the longevity of their sponsorship deal.
“It might be very difficult to extricate themselves from it.”
Newcastle Central MP Chi Onwurah said the possibility of Wonga continuing as sponsor would be in direct contradiction of its vow not to target children.
She said: “The idea that Wonga is not targeting children when its logo is emblazoned across toddlers throughout Tyneside would be laughable were it not so serious,” she said.
“I look forward to a day when Newcastle United’s sponsors are not a source of shame for so many fans, until then I will not be attending matches at the stadium.”
One the issue of the ground re-naming, MPs refused to be drawn.
Wonga paid club owner Mike Ashley to “return” the ground’s name to St James’ Park in October 2012 after he had named it the Sports Direct Arena after his sports shop empire.
But Ms Onwurah refused to be grateful for the move.
She said: “I am not grateful to Wonga for retaining the name St James Park. Mike Ashley should never have changed it to Sports Direct in the first place.”
However, Mr Mearns welcomed the new Wonga chairman’s admission that in the past it has made “some serious mistakes” and his desire for the company to operate in a “responsible and transparent manner.”
“I very much welcomed the comments from Wonga and I think some of that comes from a realisation by them that hopefully there will be much more stringent regulation from the FCA,” he said. “They’re waking up and smelling the coffee and taking a realistic attitude.”
Source – Newcastle Evening Chronicle, 15 July 2014