Tingey Injury Law FirmFM Magazine considers the likely impact on recruitment within the logistics sector of a recent tribunal ruling that UK high street retailer Next must pay its shop assistants the same rate as its warehouse workers.
The economic case for automating the key processes within a typical warehouse or fulfilment centre has been made even more compelling following the
More than 3,500 current and former Next employees had claimed that store staff, who are predominantly women, should not be paid at a lower rate than warehouse workers – over half of whom are men. The Next staff contended that better-paid warehouse jobs are more likely to be filled by men due to the physical demands of the work. This, they argued, puts women at a disadvantage.
In its defence, Next argued that different rates of pay between its warehouse and retail staff were justified because warehouse personnel command higher salaries than shop workers across the labour market.
The retailer’s reasoning was rejected by a pay tribunal, however – a decision that it is reported is likely to cost the company in the region of £30 million in back pay.
Frazer Watson, Vice President of specialist supplier of automated sortation solutions, Rainbow Dynamics, believes the ruling is likely to add to already significant recruitment issues that the supply chain sector has been wrestling with for some time.
Rainbow Dynamics Vice President, Frazer Watson (pictured), believes the ruling will compound a recruitment bottleneck and wage inflation within the UK’s logistics sector, and accelerate a growing trend towards automation.
He tells FM Magazine: “One of the ways that logistics companies and own account warehouse operators have tried to tackle the labour crisis that has existed since Brexit has been to offer increasingly attractive rates of pay in order to draw in the workers needed to run their facilities.
“But this ruling means that if a retailer or its logistics services partner decides to seek extra warehouse staff by raising pay, the retailer must also offer its shop assistants the same deal. So, not only is the retailer’s wage bill increased but if it is possible to earn the same amount by working in the relative comfort of a high street shop as it is in a warehouse which, as everyone knows can be cold, dark and sometimes dangerous places, the already tough task of recruiting warehouse personnel will be even more difficult.
“In my opinion, this verdict can only accelerate the trend we are seeing across the logistics sector for companies to introduce automated and robotic solutions as a way of mitigating the problems associated with recruiting suitable personnel and the high cost of labour.”
Workers at five of the UK’s largest supermarkets, Asda, Tesco, Morrisons, Sainsbury’s and the Co-op, are reported to be pursuing similar equal pay cases.
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