Fed warns Minister over living wage increases

Business and Trade Minister urged to protect independent retailers as part of living wage increases

The National President of the Fed (Federation of Independent Retailers) has written to the new Secretary of State for Business and Trade Jonathan Reynolds to highlight the impact of higher wages on smaller businesses.

In his letter, Mo Razzaq says the Fed recognises the importance of providing a living wage for those who work in our shops and ensuring that staff receive a fair wage for their work.

Secretary of State for Business and Trade and President of the Board of Trade, Jonathan Reynolds. Picture by Lauren Hurley / No 10 Downing Street

He added: “We fully support the minimum wage the Labour government introduced in 1999 and its development into the Living Wage we have today. However, we also encourage you to carefully consider the impact of higher wages on independent businesses in the months and years ahead so that our members can continue to thrive.

“As you will be aware, our shops are faced with rising energy costs and competition from larger supermarkets - leaving many of our members to actually pay themselves less than the living wage.

“Furthermore, many of their goods tend to be price marked, meaning they are unable to increase prices to cover additional payrolls costs, which also include National Insurance and pension contributions.

“As always, we feel that there is a valuable balance to be struck between the welfare of employees and the vital sustainability of our smaller shops, so wages can be afforded and paid in the first place.”

Mr Razzaq also expressed concerns about equalising the minimum wage across all age ranges, as paying a lower wage for young, inexperienced workers reflects the additional investment in training that they need and allows shops to be able to afford to employ vital younger staff as needed.