In a landmark Supreme Court decision, retail employees of Asda which include shop floor workers and other front of house staff are now one step closer to succeeding in their claim for equal pay. In this ongoing lengthy dispute between Asda and its retail employees, the Supreme Court has now confirmed that those employees can be compared with employees who work in the distribution centre for the purpose of an equal pay claim.

The Claimants in this case have overcome a large hurdle but the legal battle is not over. It is now for the retail employees to prove that retail work and distribution work are of “equal value.” Asda states the retail roles are very different and distinct compared with the distribution centre.

Case Summary

The original Employment Tribunal decision on this case dated back to 2016. Asda employs over 133,000 employees across the UK. All staff who are based in-store are employed on similar terms although their pay rates differ depending on their geographical area. Asda also operate distribution centres where employees are engaged on different terms and attract a higher salary. None of the retail sites and distribution sites are connected.

In this ongoing claim, a large group of predominantly female retail workers asserted they should be paid equal to that of the higher paid, predominately male workers in the distribution centres as their roles are comparable. Asda argued that they were employed on different terms and conditions undertaking different distinct work and therefore the two cannot be compared.

The Supreme Court has issued a judgment that because there are no actual comparators in this case, the Tribunal must consider whether hypothetical comparators would have been employed on similar terms if they were employed in the same establishment as the Claimants. In this case, it was decided that the distribution workers would have been employed on largely the same terms as the retail workers if they were based at the same site.

As a result, Asda retail workers can now compare themselves to distribution workers to decide whether they should receive equal pay. The next chapter of this dispute will require the Claimants to show that they are undertaking work of a similar value and for the Tribunal to determine whether there are reasons why employees in the store are being paid less than those in distribution centres, other than gender.

Summary

Whilst this claim is good news for the Claimants, they have only passed a hurdle and are not over the finish line yet. This is one stage of a very complex case and it is likely to be a number of years until this will be finalised. Further to this judgment, Asda has released a statement confirming they will continue to defend these claims as they consider “retail and distribution are very different sectors with their own distinct skill sets.”

It is important for employers to know about the decision as it is likely to have a huge impact on all supermarkets and other retail outlets who operate a similar model and there are similar ongoing equal pay cases against other retailers including Sainsbury’s and Tesco. Other businesses should also be taking this as an opportunity to review pay across their business. It will be interesting to see how the case develops over the coming years.

Click here to see our ‘Employment Law Figures 2021’ which includes basic figures, time off work, living wage, minimum wage and tax rates.

For further information or to discuss the issues raised by this update, please contact our Employment Group on 0118 977 4045 or employment@herrington-carmichael.com.

This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.