An employment tribunal ruling that Next store staff should not be paid less than warehouse workers will accelerate the introduction of robotic solutions, according to an automation specialist.
Rainbow Dynamics said the economic case for automating the key processes within warehouses or fulfilment centres had been made even more compelling after a pay tribunal said store staff, who are predominantly women, should not have been paid at lower rates than employees in warehouses, where just over half are male.
More than 3,500 Next staff argued that better-paid warehouse jobs were more likely to be filled by men due to the physical demands of the work, which put women at a disadvantage.
The law firm representing the workers, Leigh Day, said the landmark decision was likely to cost the retailer more than £30m in back pay.
Frazer Watson, VP at Rainbow Dynamics, said he thought the ruling was likely to add to the already significant recruitment issues that the supply chain sector has been experiencing:
“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,” he said.
“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.”
Watson added that this meant could mean a major shift towards robotics to overcome the economic challenges: “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.”
In a statement, Leigh Day said: “In a clear judgment, the employment tribunal has ruled that Next failed to show that paying their sales consultants, who are overwhelmingly women, lower hourly pay rates than their warehouse operatives, was not sex discrimination.
“Sales consultants receive lower basic hourly pay than warehouse operatives (a difference ranging from £0.40 to £3). The claimants’ average salary loss is more than £6,000 each.”
Next was approached for comment.
