Over 3,500 current and former shop workers at UK retailer Next have emerged victorious in a six-year legal battle for equal pay, in a landmark ruling that could have far-reaching implications for the retail sector.

An employment tribunal ruled that Next failed to demonstrate that paying its predominantly female sales staff lower hourly wages than its majority-male warehouse workers was not the result of gender-based discrimination.

The case, which covered the period from 2012 to 2023, revealed that women made up nearly 78 per cent of retail sales jobs at Next, while men comprised about 53 per cent of warehouse staff. During this time, some warehouse employees earned between 40p and £3 more per hour than their retail counterparts.

Next had argued that the pay disparity was based on "market rates" and the need to recruit and retain round-the-clock warehouse staffing. However, the tribunal rejected this justification, stating that "for market forces to be a trump card in this way would defeat the objective of the legislation".

Elizabeth George, partner and barrister at Leigh Day, the law firm representing the workers, hailed the ruling as "hugely significant". She said: "This is exactly the type of pay discrimination that equal pay legislation was intended to address."

The decision could force Next to pay out more than £30 million in compensation and back pay. Claimants' contracts will now be adjusted to reflect fairer rates of pay, including equalised hourly wages, paid rest breaks, and equal pay for Sunday, night time, and overtime shifts.

The ruling is expected to bolster similar claims against major UK supermarkets. Leigh Day is currently coordinating equal pay cases for more than 112,000 store staff against Asda, Tesco, Sainsbury's, Morrisons, and Co-op.

Next, which reported £918m in annual pre-tax profits for 2023, plans to appeal against the ruling. The retailer stated: "This is the first equal pay group action in the private sector to reach a decision at tribunal level and raises a number of important points of legal principle."

The tribunal acknowledged that Next's pay decisions were driven by efforts to cut costs and boost profits, rather than "direct discrimination". However, it emphasised that financial considerations alone could not justify perpetuating indirectly discriminatory practices.

This landmark case marks the first successful equal pay claim of its kind against a national UK retailer and is likely to set a precedent for future cases in the private sector.

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