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Tesco faces £2.5bn back pay bill after losing equal pay case

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Written by: Emma Lunn
03/06/2021
Tesco has lost the most recent round in an equal pay claim that argues its store workers, who are mostly women, are paid up to £3 an hour less than its warehouse workers, who are mostly men.

The Court of Justice of the European Union (CJEU) ruled employees working in stores can compare their roles to colleagues working in distribution centres for the purpose of equal pay.

Affected Tesco workers could be entitled to as much as six years of back pay, amounting to about £10,000 each.

Before the UK left the EU, the CJEU was asked whether part of European law could be relied upon by people in the UK making equal value claims against their employer. Under EU law, a woman can compare their role to that of a man’s working in a different establishment if a ‘single source’ has the power to correct the difference in pay.

The CJEU said: “Where such pay conditions can be attributed to a single source, the work and the pay of those workers can be compared, even if they work in different establishments.”

Law firm Leigh Day represents more than 50,000 supermarket shop floor workers, most of whom are women, who claim they are paid unfairly in comparison to distribution centre colleagues, most of whom are men.

Earlier in the year, the Supreme Court ruled that Asda shop floor workers can compare their roles to those of their colleagues in distribution centres for the purposes of equal pay.

Despite this decision, other supermarkets are still arguing that the roles are not comparable.

Kiran Daurka, a partner in the employment team at Leigh Day, said: “This judgment reinforces the Supreme Court’s ruling that the roles of shop floor workers can be compared to those of their colleagues in distribution centres for the purposes of equal pay.

“For a long time, employers have argued that UK law in this area is unclear, but this judgment is simple, if there is a single body responsible for ensuring equality, the roles are comparable.

“Clarification from the CJEU confirms that this single source test can be relied upon by people in the UK bringing an equal value claim. This means that employers can no longer hide behind the grey areas of UK law. It’s time for supermarkets to accept that the roles of shop floor workers and distribution centre workers are comparable.”

Pam Jenkins, who works at Tesco, said: “To get a judgment confirming shop floor workers can use an easier legal test to compare their jobs to male colleagues in distribution is up lifting. I’ve always been proud to work at Tesco but knowing that male colleagues working in distribution centres are being paid more is demoralising.

“I’m hopeful that Tesco will recognise the contribution shop floor workers make to the business and reflect that in our pay.”

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