UK's Tesco faces US$5.6b in record equal pay suit

Supermarket group Tesco is facing a potential bill of up to 4 billion pounds (US$5.6 billion) in a record equal pay claim involving mainly women workers at its British stores, according to the law firm pursuing the case.

If the claim is successful it could have huge implications for British industry. However, it is likely to be bogged down in the courts for years.

Tesco is Britain’s biggest retailer and its largest private sector employer with more than 310,000 staff.

Law firm Leigh Day said yesterday the mainly male employees in Tesco’s distribution centers were paid considerably more than its largely female store workers.

The law firm is also working on claims against supermarket rivals Asda, the British arm of Walmart, and Sainsbury’s, which date back to 2012 and 2015 respectively.

Unequal pay for men and women is currently a hot topic in Britain’s boardrooms and corridors of power. The resignation last month of Carrie Gracie as China Editor for the BBC led to an investigation into pay differences at the public broadcaster.

British Business Secretary Greg Clark told Sky News he was “surprised” by the scale of the claim against Tesco.

A Tesco spokesman said the firm had not yet received a claim.

“Tesco has always been a place for people to get on in their career, regardless of their gender, background or education, and we work hard to make sure all our colleagues are paid fairly and equally for the jobs they do,” he said.

Leigh Day operates on a no win, no fee basis and takes 25 percent of any compensation obtained by its clients.

The law firm said Tesco distribution center staff may earn in excess of 11 pounds an hour, while the most common grade for store staff saw them receive around 8 pounds per hour.

This disparity could see a full time distribution worker on the same hours earning over 100 pounds a week — or 5,000 pounds a year — more than store staff.

Leigh Day said more than 200,000 Tesco employees may be underpaid and estimated shortfalls could reach 20,000 pounds each, meaning the potential bill for Tesco could be as high as 4 billion pounds.

The law firm said it had already started submitting claims on behalf of its clients via conciliation service ACAS, the first stage in the Employment Tribunal process, and had been approached by over 1,000 current and former Tesco employees.