ACS has warned the Low Pay Commission that the upcoming introduction of the Living Wage will force retailers to scale back their business plans.
In an oral evidence session, ACS Head of Policy and Public Affairs Edward Woodall outlined the issues that retailers will face when having to fund a £7.20 wage rate for over 25s in their business.
A recent survey of ACS members showed that when wages rise above inflation, retailers are forced to reduce the number of staff hours in their business (61%), delay their investment plans (62%) and look at changing pay structures throughout the business (54%).
78% of staff currently working in the convenience sector are aged over 25, so would be eligible to receive the £7.20 rate in April.
Additionally, the ACS Investment Tracker for the months June to August 2015 showed that investment levels in the convenience sector had fallen by 40% in the wake of announcements from the Chancellor on the introduction of the living wage and plans to devolve Sunday trading powers to local authorities.
ACS Head of Policy and Public Affairs Edward Woodall said: “Unpredictable increases in wage rates have a significant, damaging impact on the convenience sector. Evidence from our members show that significant jumps in wage rates will damage investment, reduce staff hours and squeeze pay structures.
“ACS supports the system for setting the National Minimum Wage, but is deeply concerned about the living wage being used as a political bargaining tool. We believe that the Low Pay Commission should have wider powers to recommend and review all National Minimum Wage and Living Wage rates, free of interference from Government.”
ACS’ written submission to the Low Pay Commission can be found here: http://www.acs.org.uk/download/low-pay-commission-consultation-on-the-national-minimum-wage/
