MPs can order the founder of Sports Direct to answer questions about how his workers are treated, the House of Commons speaker has said.
John Bercow said the matter can be taken further by immediately assessing if Mike Ashley can be held in contempt for refusing to appear at Westminster.
Mr Ashley branded MPs “a joke” on Monday as he said he would not attend, despite being formally summoned.
A Commons committee wants to quiz him over a review of staff conditions.
Mr Bercow said the Business, Innovation and Skills (BIS) select committee can now take the matter further by asking the Commons to debate the case as a matter of privilege, enabling it to consider the contempt issue.
Addressing Mr Bercow, BIS chairman Iain Wright said: “I don’t think scrutinising reports of Victorian-type employment conditions in modern day Britain is a joke.”
Mr Bercow said “the House expects witnesses to obey the committee’s order to attend”.
Mr Ashley – who also owns Newcastle United Football Club – had been asked to attend Westminster on 7 June following a BBC investigation into Sports Direct’s warehouse working practices.
He had unsuccessfully urged MPs to attend his firm’s Derbyshire base to see conditions for themselves.
In a statement, Mr Wright said: “We expect Mr Ashley to attend on 7 June to respond on public record to the serious concerns regarding the treatment of workers at Sports Direct.
“We are still to receive a formal response from Mr Ashley.”
Mr Ashley said on Monday he would not “stand idle” while Sports Direct is “subjected to public vilification”.
“In my opinion, they’re (MPs) just showboating,” he told Sky News. “In my opinion, they’re actually a joke.”
He added he would love to “box the ears” of Ed Miliband – after the former Labour leader said the company was “a terrible place to work”, in 2014.
In response, Mr Miliband stood by his claims and told the BBC the “downward spiral in the reputation of Sports Direct is down to the practices of Sports Direct”.
“All of us that have drawn attention to these practices have been right to do so,” he said.