Next apologises to staff after IT problems cause months of underpaying
The retailer Next has apologised to staff for months of salary underpayment caused by the botched implementation of a new computer system.
The FTSE 100 company has been working for months to stem issues caused by a decision to outsource its payroll functions to the US technology company Oracle. The first problems emerged in February and have affected workers paid weekly and those paid monthly.
The problems have deprived some Next staff of pay during the cost of living crisis amid rapid consumer price inflation that is denting workers’ spending power.
The retailer pays some store staff £9.36 an hour, below the Living Wage Foundation’s recommended £9.90 an hour rate outside London and £11.05 inside the capital.
Next is run by the Conservative peer Simon Wolfson. As chief executive, Lord Wolfson will receive £4.4m in pay this year, the highest level since 2015, after investors backed a 50% pay rise in May. The Church of England’s pension board has criticised “major increases in executive pay in consumer-facing companies such as Next where the workforce are not accredited as being on a living wage”.
It is not the first time this year that payroll issues have affected a large UK employer. Asda, the supermarket chain owned by the petrol station billionaires Mohsin and Zuber Issa and the private equity fund TDR Capital, has admitted that some workers lost out on as much as £500. Its external payroll provider made nearly 11,000 errors in recent months, affecting the wages of 5,500 staff.
Next declined to say how many of its 43,000 workers were affected, but a spokesman said the number had declined from the peak. A spokesperson said: “We expect to continue to make significant progress in the weeks ahead.”
Employees have been underpaid
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