Clothing chain Next has reduced sick pay for unvaccinated staff who have to self-isolate because of Covid exposure.
The retailer follows a similar move by furniture giant Ikea, and said its new policy stemmed from having to balance staff and shareholder needs. It was, however, an “emotive topic”, it conceded.
Unvaccinated staff will still get full sick pay if they test positive for the virus.
Employers across the UK are facing mass absences because of the rapid spread of the Omicron variant and the government has extended the period for which employees do not need a note from their doctor to remain off work.
The BBC said it was unclear when Next made the change but it is believed to have been recent.
Unvaccinated workers at Next who are required to isolate having been identified as a close contact of someone with Covid could now receive as little as £96.35 a week – the statutory sick pay minimum – unless there are mitigating circumstances.
People who have been vaccinated no longer need to isolate if they have been exposed to a positive case under official self-isolation guidance issued last month. If a fully vaccinated person tests positive themselves, however, they need to self isolate for five days (reduced from seven). But guidance for unvaccinated close contacts, who must still self-isolate for 10 full days after their date of exposure, has not been changed.
This week it was reported that Ikea, which employs about 10,000 people in the UK, had changed its policy on unvaccinated staff who have been exposed to coronavirus. Sick pay cuts will also be implemented at Wessex Water.
Next’s move comes days after it said it was putting up its prices to offset higher wage and manufacturing costs. The company employs around 37,000 people in the UK (44,000 worldwide) across 500 stores in the UK and Ireland, with 86% of them being women. Last year the firm acknowledged that its store workers could compare their roles to that of their colleagues in distribution centres and warehouses – where more men work – in terms of pay.
In October last year, Next boss Lord Wolfson, a Brexit supporter, said the retailer had struggled with labour shortages because workers were not available in the places needed and seasonal workers had proved difficult to recruit. He added the problem could be solved by companies hiring overseas workers and paying a “visa tax”.
Most sources suggest Next pays very close to minimum wage levels for various age groups: between about £6.56-£8.91 for sales assistants, and £7.44-£10.21 per hour for warehouse operatives.
Morrisons supermarket cut sick pay for unvaccinated staff in September 2021 after facing what it called “biblical” pandemic costs.
Marie Horner, partner in employment law at Langleys Solicitors, said that many companies would be considering whether to follow Ikea, Next and Wessex Water, in dropping sick pay to statutory levels for unvaccinated workers who are forced to isolate. But she warned that businesses that acted impulsively could find themselves facing claims – particularly as sickness policies don’t refer specifically to Covid-19. She said: “Most contractual sick pay clauses generally provide that workers will receive company sick pay if they adhere to the terms of their contract of employment and to the requirements of the sick pay policy within the company handbook.
“Most contracts and policies do not expressly define what ‘sickness’ is for the purpose of receiving company sick pay, but, rather, the policy often adopts the definition of sickness for the purpose of assessing eligibility for statutory sick pay. In that scenario, without anything clearly to the contrary, there is an argument that, if a worker qualifies for statutory sick pay, he/she is also entitled to enhanced company sick pay where such provision is present in the contract; to refuse to pay it to unvaccinated individuals might place the company in breach of that contract.”
However, she added, if enhanced sick pay was paid to those staff required to self-isolate as a discretionary gesture during difficult times and there was never a contractual entitlement to the additional pay in the first place, “it would be far easier to now withdraw that discretion and enhance pay on a more selective basis in response to the changing circumstances”.
“In essence, if you have a formal contractual company sick pay scheme, it is imperative that the terms of that scheme are checked before any decision can be taken upon withholding company sick pay for unvaccinated staff on a period of self-isolation. Indeed, if you expressly have purely discretionary sick pay terms in your employment contracts, but the reality is that you always enhance pay for staff on sick leave, beware the pitfall of assuming that your scheme remains discretionary – it may not and advice should be taken before any decisions are made.”
Latest HR job opportunities on Personnel Today