Tesco Equal Pay Tribunal Defence Cites £5.50 Gap

Tesco told the tesco equal pay tribunal in Reading on Friday that closing the gap between store workers and warehouse staff would ignore "economic reality" and risk "serious damage" to the business. The case centres on pay differences that can leave store staff earning up to £5.50 an hour less than warehouse colleagues.

The claim began in 2018 and covers around 60,000 workers. It seeks up to six years of back pay for 2012 to 2018, with Leigh Day representing around 17,000 current and former employees.

Reading tribunal case

Paula Lee, a Leigh Day employment partner, said Tesco was expected to lean heavily on market rates to justify the pay gap. She said, "Our clients’ case is that those markets are not neutral or external forces operating beyond Tesco’s control."

In written submissions, Tesco described the case as extraordinary and said the pay differences reflected market conditions and "genuine pressing operational needs." It also said its pay structure was shaped by "commercial and operational judgements" required for the company to remain "viable, competitive and able to continue employing hundreds of thousands of colleagues across the UK."

Tesco pay structure defence

Tesco relied on a material factor defence at the tribunal. The company said the gap was not driven by gender and warned that a ruling against it could create major disruption, including potential industrial action among warehouse workers and a situation where some staff could be paid more than their managers.

Leigh Day has previously estimated the case at around £4bn. Tesco has said the potential cost could be £1.7bn across 250,000 workers.

Decision later this year

The hearing is expected to last five weeks, and a decision is due later this year. For the workers in the claim, the tribunal will determine whether Tesco can hold its pay structure on the basis it has set out, or whether it must face a large back-pay bill stretching to 2012.