Next apologises after under-paying staff due to IT issue

By

Nigel TAYLOR

Published
Jul 18, 2022

Tough cost-of-living times for UK workers have got even tougher for some Next employees. An unreported number of the fashion and lifestyle retailer’s 43,000-strong workforce have been underpaid over several months after the implementation of a new payroll system failed to work properly.

Next has apologised to staff over the ongoing problem, after having worked for months to resolve 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 both weekly monthly.

Employees have been underpaid by as much as £200 a month. The Sunday Times, which first reported the problems.

Monday newspaper reports also noted that 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 declined to say how many of its workers were affected, but a spokesman said the number had declined from the peak, adding: “We expect to continue to make significant progress in the weeks ahead.”

“Over the last few months we have experienced a number of issues with our new payroll system and have been tackling them as a matter of urgency,” the spokesman said. “This is one of the very few instances where Next has outsourced critical software and we have learnt some important lessons about integrating our in-house applications with third-party platforms.

“We are acutely aware of the problems these payroll errors have caused some of our colleagues. We sincerely apologise to all those affected and assure them that we are resolving these problems as a priority.”

As the retailer struggles to make Oracle’s software work, the original report said it has been forced to assign a dedicated team to try to spot errors and pay the missing money to workers every week.

Next has been one of UK retail’s success stories after coming through the pandemic in relatively good shape. The retailer reported pre-tax profits of £823 million last year, the highest in its 40-year history.