Matalan is facing the threat of strike action at its Merseyside warehouse after a pay dispute erupted between management and factory workers.
The GMB union has reacted with fury after claiming supervisors at the retailer's Knowsley facility had been given a £1,500 pay rise, in addition to a 2% increase, while warehouse staff were left struggling on low wages.
Following discussions with Matalan, the GMB will ballot staff at the facility over a pay offer put forward by the chain, which amounts to a 3.17% salary increase for around 700 workers.
The GMB said the pay hike would bring their wage up to just 20p above the minimum wage, adding that staff have been made to endure years of below inflation pay increases.
The result of the ballot is expected on Monday.
A spokeswoman for Matalan said:
Earlier this week, the discount retailer said it is "well positioned" to cash in on Britain's slowing economy and a Brexit squeeze on consumer spending as it posted rising sales.
In a trading update for the 13 weeks to May 27, the firm reported a 1.3% increase in revenue to £253.4 million, driven by a 21.5% increase in full price sales.
Earnings rose from £16.2 million to £22.3 million in the period, and chief executive Jason Hargreaves pointed to a climate of uncertainty and tough times for shoppers in a "challenging market".