Mike Ashley has pledged to spend £10m on raising the pay of all of Sports Direct's employees to above the minimum wage.
The move follows criticism from unions and in Parliament over the retail giant's pay and employment practices, including the use of zero hours contracts, under which staff do not know how many hours they will work from one week to the next.
It also comes shortly after the board announced that the Newcastle United owner would oversee a review of all agency worker terms and conditions at the company.
The rise, announced in an interview with the Daily Mirror, is likely to most benefit casual workers in its stores and agency staff in its depot.
He told the paper: "I'm making a New Year's resolution pledge to the Daily Mirror - and I'm deadly serious. I want to see Sports Direct become the best high street retail employer, after John Lewis.
"I realise this is ambitious and it won't be easy but I believe as a FTSE 100 or even 250 company we have a responsibility to set a high moral standard.
"We're putting our money where our mouth is and have notified the City we wil be spending £10mn ensuring all employees are above the minimum wage."
He added that thousands of Sports Direct staff received "life-changing" bonuses each year.
The rise will amount to around 15p an hour meaning workers 21 and above will receive £6.85p per hour, and 18 to 20 year olds will be paid £5.45p hourly, the paper said.
There are around 4,300 agency workers employed in Sports Direct's warehouse, while the company employs around 28,000 staff across the UK and Europe.
Sports Direct posted half-year results showing a 3.6% rise in underlying pre-tax profits for the six months to October 25.
Ed Miliband has claimed 17,000 of Sports Direct's 20,000 strong workforce are on zero-hours contracts as he attacked the company as a "terrible" employer for some staff.
Speaking in Coventry, the Labour leader said the company "has predictable turnover, it has big profits but, for too many of its employees, Sports Direct is a terrible place to work".
"We cannot go on with an economy that allows businesses to use zero-hours contracts as the standard way of employing people month after month, year after year," he said.
Describing what he calls a "zero-zero economy" - where workers have no guaranteed hours and those at the top pay no tax - Miliband added: "These Victorian practices - the epidemic of zero-hours contracts that we see at Sports Direct - have no place in the 21st century."
According to the Office for National Statistics, around 1.4 million people were on zero-hours contracts in the UK when estimated earlier this year.
Business Minister Matthew Hancock says the government is already tackling the abuse of zero-hours contracts amid criticism from Labour leader Ed Miliband over the practice.
Hancock said Miliband's plans to ban employers from using such terms represented a "rehashed policy" and said Miliband's own Doncaster Council had admitted using 300 people on zero-hours terms.
Ed Miliband will single out high-street chain Sports Direct for criticism over its use of zero-hours contracts in a speech today.
The Labour leader will accuse a number of firms of using "Victorian practices" in using such terms, which see employees given no guaranteed hours and those at the top can escape taxation.
Speaking in Coventry, Miliband will describe Sports Direct as an example of a firm where the "vast majority" of employees are on zero-hours - calling it a "bad place to work" for many staff.
The retail giant agreed last month to make "major changes" for staff after legal action brought by a former employee.
Sports Direct did not comment on Mr Miliband's attack, but repeated an earlier statement on its plans to make changes.
A spokesman said: "The company will continue the process of reviewing, updating and improving our core employment documents and procedures across our entire business beyond its existing compliant framework."
Sports Direct, which is owned by Mike Ashley, has announced that its profits are rising. They were up by 14.6% in the 13 weeks ending on 26 January 2014, totalling £280.7 million.
Here are some of the key figures in more detail:
- Sales for the 13 weeks ending 26 January 2014 were up 11.2% to £655.4m
- Sports Retail sales in the 13 week period increased 6.9% to £529.9m
- Premium Lifestyle sales in the period were up 52.5% to £71.2m
- The Brands division revenue increased by 15.5% to £54.3m
The company will release their preliminary results on 17 July 2014.
Newcastle United owner Mike Ashley has made £106 million after selling a 2.7% stake in his Sports Direct business.
It comes less than a year after he raised £100 million by offloading a 4% holding.
The sale was announced after Sports Direct reported yet more strong trading figures, with a 15.1% sales surge in the nine weeks to September 29.
Mr Ashley still has a 61.7% holding in Sports Direct.
More than 2,100 jobs have been saved by Sports Direct International's purchase of 116 stores from fashion retailer Republic.
The Sports World group has also taken over the stock, along with the group's head office in Leeds and its websites and brands SoulCal, Fabric and Crafted.
Newcastle United owner Mike Ashley has raised 100 million pounds after selling a four percent stake in his company.
The move has sparked speculation over his plans for the cash haul, amid rumours that the sports retail tycoon is interested in expanding his retail empire - possibly to include collapsed fashion chain Republic.
Sports Direct's brands also include Firetrap, Dunlop, Slazenger, Everlast, Lonsdale and Karrimor.
The Newcastle United owner currently owns a 64% stake of Sports Direct's shares, and Nick Bubb, an independent retail analyst, believes Mr Ashley's share sale may have been in response to requests to free-up stock to investors:
"I think he's doing it to improve liquidity in the stock - he doesn't need the money and if he was intending to bid for retail assets, he would do that through Sports Direct."
The move may also fuel hopes among Newcastle United fans that Mr Ashley is planning to bolster the squad with more new players in the summer, having recently secured five new signings.