1) Next Retail Ltd 2) Next Distribution Ltd v Thandi and others [2026] EAT 130
Judgment in equal pay litigation arising from pay differences between retail and warehouse staff
The summary below is that provided within the judgment of Mr Justice Bourne:
In respect of the employer’s appeal against the Employment Tribunal’s finding that it had not made out the material factor defence under section 69(1)(b) of the Equality Act 2010 with regard to the difference between the claimants’ and the comparators’ basic pay (and some other benefits):
(1) The Employment Tribunal did not err in finding that the claimants had shown particular disadvantage because of the statistical differences between the claimant and comparator groups together with its other findings of fact.
(2) However, it erred in finding that the employer did not pursue a legitimate aim when setting different rates of pay. The aim, taken as a whole, of paying higher rates to warehouse staff included recruitment and retention factors which did not apply to the claimant group. It was not necessary for the employer to justify not increasing the claimants’ pay to the same level.
(3) Its alternative finding that the employer’s reliance on a material factor was not a proportionate means of achieving a legitimate aim therefore could not stand, and in any event it erred in the assessment of proportionality when analysing the market forces factor, and in focusing on the reasons for the claimants’ lower pay and the affordability of increasing it rather than on the reasons for the comparators’ higher pay.
(4) There was no error of law in the Employment Tribunal’s analysis of some of the other pay benefits.
In respect of the claimants’ cross-appeal, the Employment Tribunal did not err when finding that there was no direct discrimination contrary to section 69(1)(a) of the 2010 Act. In particular:
(1) It is not the case that direct discrimination must always be found where an employer relies on a material factor of market forces and does not adduce evidence to prove that those market forces do not disadvantage those of either sex.
(2) There was a sufficient evidential basis for the findings as to the employer’s reasons for its decisions despite the employer not calling evidence from a Board member or adducing documentary evidence stating the reasons.
Published: 08/09/2026 13:10