Next has won a significant appeal, allowing it to continue paying its warehouse workers a higher basic hourly rate than shop floor staff in a dispute concerning equal pay. The Employment Appeal Tribunal overturned a key aspect of a 2024 ruling that had found the retailer's pay structure to be discriminatory.
The original ruling would have enabled more than 3,500 current and former employees, predominantly women, to potentially claim over £30 million in back pay. The law firm Leigh Day, representing the store workers, expressed disappointment with the outcome regarding basic pay and intends to appeal the decision.
The tribunal accepted Next's argument that it needed to offer higher rates to warehouse workers to address recruitment and retention challenges specific to those roles. Next hailed the decision as a "landmark victory," emphasizing that the Appeal Tribunal affirmed the justification of distinguishing pay based on market forces when there is a clear rationale.
"The importance of this decision is that the Appeal Tribunal has confirmed that it was justifiable for Next to rely on market forces to distinguish between different groups of employees, where there was a good rationale to pay one group more than the other," the company stated. "In this case, Next had to pay a higher market rate to warehouse operatives because of recruitment and retention pressures, which did not apply to the workforce in its stores."
Next plans to seek permission to appeal against other elements of the ruling that the judges upheld. These include findings related to night-time premiums, overtime premiums, and paid rest breaks. The initial Employment Tribunal and the Appeal Tribunal both concluded that there was no direct sex discrimination in Next's pay practices, despite shop floor staff being predominantly women and warehouse workers predominantly men.
This case is part of a broader trend of equal pay disputes. In the past year, thousands of female workers at Birmingham City Council received payouts as part of a settlement, and Brighton and Hove City Council is currently facing over 1,000 equal pay claims.