The Association of Convenience Stores (ACS) has urged the Low Pay Commission (LPC) to take a “cautious approach” to future wage rate recommendations.
Each year, the LPC advises government ministers on the appropriate wage levels, with the final decision typically announced in the Chancellor’s Autumn Statement.
This April, the NLW rose 6.7% from £11.44 to £12.21 per hour for workers aged 21 and over. The increase met the government’s target of raising the NLW to two-thirds of median earnings, while also providing a “real-terms increase” for low-paid workers, said the LPC
The LPC recently launched its annual consultation to gather opinions from businesses, workers and stakeholders.
Responding to the consultation, the ACS said this year’s “challenging” NLW hike was coupled with increases in Employer National Insurance Contributions (NICs) and a reduction in the threshold at which they start paying NICs.
The trade body said retailers have been taking lower profits, increasing prices and reducing the number of staff hours in the business to ease the rising costs.
“This year has been extremely challenging for retailers, with many facing increases in their employment costs that have resulted in fundamental changes to the way that they run their businesses,” said James Lowman, CEO of the ACS.
“We have urged the Low Pay Commission to take this impact into account when making future recommendations, and to go no further than the existing two-thirds of median earnings target.”
The ACS also suggested introducing the NLW eligibility gradually, bringing in one age group at a time instead of making a direct jump from 21 to 18.
“Convenience stores are engines of local growth that want to be able to invest in their products, processes and people but this can only be achieved if there is stability in the costs that they’re facing,” added Lowman.
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