The Association for Convenience Stores (ACS) has called for enforcement of the National Living Wage to ensure a level playing field and prevent businesses from gaining unfair competitive advantages.
According to the latest information published by the Office for National Statistics on the number of UK jobs that pay less than the National Living Wage (NLW) and National Minimum Wage (applied to people under 25 years old), only a small proportion of retail businesses are paying below the rate compared to other UK businesses.
The report estimated that 362,000 jobs across the country pay less than the minimum wage with 178,000 being full time. It found that just 2.2% of jobs in the retail sector were reported to be paid below the minimum.
By sector, the hairdressing industry was reported to have the highest proportion of low-paid jobs, in which 7.0% of jobs were paid below the minimum wage rate in April 2016.
ACS chief executive James Lowman said: “We remain concerned about the impact of the National Living Wage on retail businesses, but there needs to be a level playing field where all businesses pay at least the nationally set rate. We support strong enforcement of the law to ensure that businesses do not gain an unfair competitive advantage by underpaying their staff.”
The ACS’ submission to the Low Pay Commission earlier this year showed that independent retailers are already cutting back as a result of the NLW, with 67% of retailers reporting that they are reducing the number of staff employed in their business and 15% saying that their business is less competitive as a result of the £7.20 rate.
The current rates of the National Minimum Wage for adults aged 21-25 is £6.95 per hour while the NLW for adults over 25 years-old is £7.20 per hour. The youth development rate is £5.55 per hour and 16-17-year-old rate is £4.00 per hour.
The government remains committed to rising the National Living Wage to 60% of median earnings by 2020. The Low Pay Commission is due to make recommendations on 2017 wage rates later this month.