Members of shopworkers’ union Usdaw, which represents 5,500 Shop Direct staff and their 1,100 counterparts in the GMB trade union, have rejected a below-inflation pay offer from the retailer. Staff involved work in the retailer’s call centres, warehousing and returns departments.
Ballot papers were mailed this week to the unions’ members and those involved have until September 2 to vote on action.
Strike action would be a bitter blow to Shop Direct, which is half way through a five-year turnaround programme, spearheaded by chief executive Mark Newton-Jones. He laid out plans earlier this year to double online sales to more than£1 billion by 2011.
Pay has become an increasingly controversial issue in light of surging inflation – this week reaching 4.4 per cent – and unions are taking a more militant line. A dispute over pay is ongoing at Argos and an industrial action ballot over pay at Harrods closes on Monday.
Shop Direct offered a 3 per cent pay increase from July 1 initially, subsequently upping it to 4 per cent from October. Usdaw and the GMB argue that the raised offer only equates to 3 per cent in real terms.
9,000 staff, about 72 per cent of Shop Direct’s total workforce, could have been involved in action originally. However, members of Unite have accepted the retailer’s offer.
Shop Direct, formerly Littlewoods, defended its offer. A spokesman said: “Despite the challenges of trading within the present economic climate, Shop Direct has still proposed a 4 per cent increase effective October 2008 and a further 4 per cent increase effective July 2009, which equates to a compounded offer of 8.16 per cent.”
He added: “Shop Direct is committed to the fair and competitive remuneration of its employees and strongly believes that this commitment is reflected in its offer.”
Usdaw national officer Val Pugh said: “Many of our members are very low paid so in the current climate the rejection of a pay offer worth just 3 per cent this year should not have come as a surprise. The union remains open to discussion with the company but it would have to be an improved offer.”