Next has warned it could close shops if its appeal against a landmark equal pay ruling fails.
The caution comes after an employment tribunal found in August that 3,500 predominantly female Next store workers should not have been paid less than their mainly male (52%) co-workers in warehouses.
The fashion giant explained that if it loses its appeal and has the burden of extra pay, which some have warned could cost the retailer £30m, it would impact the profitability of individual stores.
The retailer said: "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."
Related Story
Next chief executive Lord Wolfson insisted: "This is certainly not a threat...You wouldn’t expect a retailer to renew a lease in a shop that was making a loss”
“All we were pointing out was anything done to increase cost, whether that be rent or payroll, will affect those individual decisions as and when they're taken."
However, the fashion brand said its legal team were "very confident" of its grounds for appeal.
The news comes as Next upgraded its full-year guidance for the second time in two months.
The high street giant added £15m to its annual forecast, which now stands at £995m – up 8.4% on last year’s profits – as its first half pre-tax profit increased 7.1% to £453m in the six months to July.
Click here to sign up to Retail Gazette‘s free daily email newsletter
