Knock on effects on payroll costs and the negative impact this has on independent retailers’ businesses must be taken into account when rises to minimum wage rates (NMW) are recommended, the Low Pay Commission has been told.
The call came in the Federation of Independent Retailers’ (NFRN’s) annual written submission to the Low Pay Commission.
In its submission, the Federation warned that increases to NMW rates threatened jobs and staff working hours and often resulted in shop owners having to take on extra hours themselves.
Commenting on the NFRN’s calls, National President Stuart Reddish explained: “The headline increase in the wage rate does not include the increase in the national insurance and pension contributions that employers also have to pay.
“Given that many of the items on sale in our 11,000 members’ stores – particularly newspapers and magazines – are price marked, retailers are unable to increase prices to cover these additional payrolls costs. We would all like to pay our staff more but increases to both the national minimum wage and living wage force our members to cut staffing levels and hours, taking on more of the work themselves. All too often, we end up paying ourselves less than the national minimum wage per hour.”
Mr Reddish concluded: “Local independent stores are valued by local people as they provide much-needed services and a heart for the community. Increasing costs, be they payroll, business rates or the costs of provider services, are continuing to damage businesses and reducing the amenities available to the local communities.”
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