Labour’s proposal to lower the minimum wage eligibility age has raised significant concerns among retailers, who warn it will impact hiring practices across the sector.
Ahead of Labour’s victory landslide, the party said it would bring changes to legislation as part of its ‘new deal for working people’.
Its ‘Make Work Pay’ plans promised to ensure that the minimum wage is a “genuine living wage”.
Labour pledged to “remove discriminatory age bands to ensure every adult worker benefits” and to make sure “the minimum wage is a real living wage that people can live on”.
Currently, the minimum wage for 18 to 20-year-olds is £8.60, and for 21-year-olds and over, it is £11.44.
If the legislation is enforced, this would mean that workers aged 18 and above would be entitled to the same minimum wage as older adults and hundreds of thousands of UK workers would recieve a pay rise.
Susan Connolly of Connolly Spar store in Tidworth, Wiltshire stressed that the Labour government will impact her business in a “huge way”.
She said that it would put young people at a significant disadvantage because their ethics and skills are different from those of older individuals. “I would be more inclined to employ an older person than a younger person, so it’s going to make it even harder for younger people trying to find work.”
Raaj Chandarana of Tara’s Londis in High Wycombe expressed concerns over the support that retailers can receive to offset the increase in prices: “So if you’re 18 years old, you’re going to be earning the same as someone on 22, and that’s going to affect a lot of the retail businesses.”
Raaj had MP Emma Reynolds visit the store in the run-up to the election but didn’t feel that she answered all of his questions clearly.
“If you look at someone like Tesco, they look to employ a lot of 18–19-year-olds because it’s cheaper. So, what’s going to happen is we’ll see an increase in price. When I had my MP down and we had a chat, I asked ‘so what are you going to do to counter that?’ or support convenience stores on this, she literally didn’t have an answer.”
Warwickshire-based retailer Avtar Sidhu stated that he would become “a little bit more picky” and would reset his recruitment process for his Budgens and Londis stores to ensure that they attract the right talent.
Avtar said: “If there’s no price difference, you’re going to try and make sure that you’re a bit more picky on who you bring in”.
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