Tesco faces £2.5bn bill after staff win equal pay dispute

Grocery giant Tesco is facing the prospect of a £2.5bn bill after the European Court of Justice backed thousands of current and former shopfloor workers in a mammoth equal pay lawsuit.

The Court of Justice for the European Union (CJEU) ruled yesterday in favour of thousands of Tesco staff, mainly women, that EU law could be relied on in making equal pay claims against their employer.

Staff had argued that they failed to receive equal pay for work of equal value compared with their predominantly male warehouse counterparts.

The UK’s biggest retailer and law firm Leigh Day have sought clarification from the CJEU on whether the so-called ‘single source’ test applies to businesses in the UK.

Under European law, a worker can be compared with another worker in a different function if a single source can correct the difference in pay.

The ruling follows the Supreme Court’s decision earlier this year that Asda shopfloor workers could expect the same pay as staff in the retailer’s distribution centres.

Leigh Day said that the combined rulings against Tesco and Asda had made it increasingly difficult for supermarkets to differentiate between shopfloor and warehouse worker pay.

Partner Kiran Dauka said: “This judgement reinforces the Supreme Court’s ruling that the roles of shopfloor 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 judgement is simple: if there is a single body responsible for ensuring equality, the roles are comparable.”