ACS Warns of Impact of Above Inflation Minimum Wage Increase

ACS has warned that the above inflation 3% increase in the adult National Minimum Wage to £6.70 will have a negative impact on staffing and investment levels in the convenience sector.

ACS chief executive James Lowman said: “We are disappointed with the increase in the National Minimum Wage above inflation, above average earnings growth, and above public sector pay award levels. Our research has clearly shown that retailers have little choice but to reduce staff hours and delay further business investment when the minimum wage is increased.

“However, despite our disappointment with the increase, we are pleased that the Government has not buckled under the political pressure and gone beyond the recommendations of the Low Pay Commission. We firmly believe that the Low Pay Commission is best placed to recommend the wage rates”.

The new rates, in effect from October 1st 2015 are as follows:

  • Adult minimum wage rate: £6.70 (from £6.50)
  • Youth rate (18-20): £5.30 (from £5.13)
  • Youth rate (16-17): £3.87 (from £3.79)
  • Apprentice rate: £3.30 (from £2.73)

The 2014 ACS Minimum Wage Survey showed that 88% of retailers have reduced staff hours within their business as a result of increases in employment costs, while 72% have increased their own working hours in order to reduce costs in their business. ACS research has also shown that the majority of independent retailers believe that they earn less than the national minimum wage when their working hours are taken into account.

ACS made a submission to the Low Pay Commission about the national minimum wage in September 2014, which can be viewed here: