High street giant Next has warned it could close down stores after losing a legal battle over equal pay.
The fashion retailer, which has stores in Bury St Edmunds and Martlesham, is planning to appeal against the decision which last month saw more than 3,500 former and current employees at the company win their pay claim after a six-year battle.
An employment tribunal ruled that Next failed to demonstrate that the lower basic wage paid to sales consultants compared with warehouse operatives was not the result of sex discrimination.
Now, chief executive Lord Wolfson has said that while he is confident in winning the appeal of the tribunal, if it is unsuccessful they could be forced to shut some stores.
In its half-year results, the group said: “In the possible (but unlikely) event we lose this case on appeal, there will be a financial cost to the group and its ongoing future operating costs.”
It added: “Each of our stores is treated as a business in its own right, and must remain individually profitable if they are to open in the first place and continue trading at lease renewal.
“Inevitably some of our stores will no longer be viable if this ruling is upheld on appeal.
“Materially increasing store operating costs will result in more shops being closed when their leases expire, and will materially impede our ability to open new stores going forward.”
The firm also said that the case could have an impact on the “viability of our warehouse operation” if it cannot increase pay for workers at the sites.
“If, for many people, warehouse work is less attractive than work in stores… how can a warehouse attract the number of employees it needs?” the group said.
The company said its legal team was “very confident of our grounds for appeal”, but stressed the process may not conclude for at least a year.
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