Fresh research from the British Retail Consortium (BRC) has once again sounded an alarm for the prospects of business as it braces for the impact of the Employment Rights Bill (ERB).

More than half of retail HR directors have told the BRC that the legislation will reduce hiring and job flexibility, while 70% said it will have a negative impact on their business.

The survey of HR directors (HRDs) among prominent retailers reveals the scale of concerns about the impact of the EBR, which is on the agenda for debate in the House of Lords today (April 29).

The survey found:

● More than 70% of retail HRDs felt the Bill would either have a negative or very negative impact on their business, with fewer than one in 10 believing it would deliver any benefits.

● 52% of retail HRDs suggested the Employment Rights Bill would result in a reduction in staff numbers in their business (35% unchanged; 3% increased; 10% "don't know").

● Meanwhile, 61% said that the Employment Rights Bill would reduce flexibility in job offerings (23% unchanged, 7% increase, 10% "don't know").
 


The BRC said: "The biggest concern for HRDs is around proposals to establish rights to guaranteed hours, which risk making it much harder to offer people part-time jobs."

Some 1.5 million of the three million people in retail currently work part-time, which allows them to work as much or as little as they need, and to balance work with their other life commitments. 
 
Costs were another cited concern, with 52% of respondents expecting the ERB to increase prices, with none suggesting it would reduce prices for customers (26% unchanged, 23% "don't know").

This comes just weeks after the increase in employer National Insurance Contributions and National Living Wage that together will cost retailers £5bn in the coming year.

Helen Dickinson, BRC Chief Executive, said: "Almost 250,000 jobs have been lost in retail over the last five years and many major retailers have already announced further job cuts on the back of increased costs of employment which kicked in in April. Those in charge of retail hiring are clear - unless amended the Bill will make it even harder to keep and create jobs and reduce the flexibility that defines many existing retail roles."

She added: "This matters: local, flexible retail jobs are an important stepping stone for those entering or returning to the workforce. Retailers agree with Government on the need to crack down on unscrupulous employers, but in its current form the ERB could backfire, putting the brakes on hiring, or worse still, putting retail job numbers further into reverse. 
 


"The Government wants growth and wants to reform welfare and increase the numbers in work. We are aligned on the objectives. Now its about making sure the implementation of policies help not hinder retailers ability to provide the very jobs the economy needs. Changes to guaranteed hours proposals and ensuring government's willingness to engage translates into meaningful changes to the current direction of travel will provide clarity so retailers can stop considering or making decisions based on worst case scenarios. Many of the amendments being debated in the Lords today would provide some of this valuable clarity, so I hope to see them supported by Peers and accepted in turn by the Government."

The BRC already estimates that food inflation will hit 5% by the end of 2025 and, also released today, it has issued figures to track how prices rose in April at the highest rate for 11 months.

The BRC research found that food inflation increased to 2.6% year on year, against growth of 2.4% in March. This was above the three-month average of 2.4%

Shop price inflation meanwhile increased to minus 0.1% year on year, against a decline of minus 0.4% in March. This was above the three-month average of minus 0.4%, while non-food inflation increased to minus 1.4% year on year, against a decline of minus 1.9% in the previous month. This was above the three-month average of minus 1.8%.

Ms Dickinson, added: "The days of shop price deflation look numbered as food inflation rose to its highest in 11 months, and non-food deflation eased significantly. Everyday essentials including bread, meat, and fish, all increased prices on the month. This comes in the same month retailers face a mountain of new employment costs in the form of higher employer National Insurance Contributions and increased NLW."
 
Despite price competition heating up, retailers were seen to be unable to absorb the total impact of £5bn of employment costs, she said, while they also now face the additional £2bn costs when the new packaging tax comes into effect in October.

She added: "It is crucial that poor implementation of the upcoming ERB does not add further pressure to costs - pushing prices further up, and job numbers further down."

Mike Watkins, Head of Retailer and Business Insight, NielsenIQ, said: "Shoppers continue to benefit from lower shop price inflation than a year ago, but prices are slowly rising across supply chains, so retailers will be looking at ways to mitigate this as far as possible."