The process of determining minimum wage rates in future should remain independent, evidence-based and free of political pressure, the Association of Convenience Stores (ACS) said.
In its submission to a consultation on future minimum wage rates by the Low Pay Commission, ACS has called for wage rates to be set based on objective economic analysis and in consultation with business groups, trade unions and economists.
Minimum wages are expected to reach the Low Pay Commission’s target of 60 percent of median earnings by 2020, a rate which is currently predicted to be £8.67 for the National Living Wage.
“We urge the Government to ensure that the setting of future minimum wage targets beyond 2020 is done on the basis of economic analysis, carried out by the Low Pay Commission and taking into account the potential negative effects of above-inflation increases on the viability of thousands of jobs and ultimately businesses themselves,” said James Lowman, chief executive of ACS.
“Future wage rates must not be used as a political bargaining or campaigning tool,” he added.
The organisation has also urged caution with future wage increases, noting the negative impact of wage rates on the small businesses.
“Our survey of retailers in the convenience sector shows that they are continuing to cut back in response to rising wage rates, taking measures including reducing investment, cutting back on staff hours and working more hours in the business themselves. While retailers have always looked for ways to increase productivity and efficiency, there are only so many measures they can take, and these cost increases are being keenly felt in our sector,” Lowman said.
According to the ACS’ annual National Living Wage Survey, 72 percent of retailers have reduced the number of paid working hours in their business since the April 2019 increase. And, 52 percent of independent retailers have taken on more hours in the business themselves as a result of the increase.
In its submission, ACS has outlined support for consolidation of the youth rates to provide clarity and additional fairnesss for colleagues. ACS’ National Living Wage survey found that convenience stores tend not to use the youth rates, as they find it difficult to justify paying colleagues in the same roles different rates based on their age alone.
ACS recently facilitated a discussion between commissioners and convenience retailers to better inform the Low Pay Commission on the challenges retailers face with wage rates.