Subsequent has warned that it might have to shut shops after shedding a big authorized battle over equal pay, which may value the retailer over £30 million.
The FTSE 100 clothes and homewares chain introduced in its half-year report that the ruling may have an effect on the profitability of particular person shops. Final month, an employment tribunal dominated in favour of three,540 present and former feminine retailer workers who argued they had been paid lower than predominantly male staff within the firm’s warehouses.
Subsequent is interesting the choice, which dates again to October 2018, and said its authorized group is “very confident” of their grounds for enchantment. Nonetheless, the retailer acknowledged that the case may take greater than a 12 months to resolve.
The landmark resolution is the primary of its sort in opposition to a British retailer, opening the door for additional claims. An analogous equal pay case involving over 60,000 Asda staff is predicted to conclude early subsequent 12 months.
In its report, Subsequent highlighted the potential penalties of the ruling, warning: “Some of our stores will no longer be viable if this ruling is upheld on appeal. Increased operating costs will lead to more store closures when leases expire and will hinder new store openings.”
Subsequent additionally raised considerations about its warehouse operations, noting that wage will increase in warehouses would necessitate matching will increase in retailer workers salaries, additional impacting the corporate’s value construction.
Regardless of the warnings, Lord Wolfson, Subsequent’s chief government, clarified that the retailer just isn’t issuing threats however merely addressing the monetary realities of retailer profitability. “Whether we open or close stores will depend on each individual store’s profitability,” Wolfson defined. He additionally identified that many excessive avenue outlets have closed up to now decade as a result of rising prices and declining gross sales.
Subsequent, which operates 458 shops throughout the UK, doesn’t make use of staff on zero-hours contracts and as an alternative gives extra hours to current workers throughout peak intervals equivalent to Christmas.
