Creative HEAD February 2018
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#BusinessEdit<br />
Pension changes “will<br />
triple employer costs”<br />
SALON BOSSES WILL see pension costs<br />
triple through changes to pensions autoenrolment<br />
contributions, the NHF has said.<br />
Since auto-enrolment was introduced,<br />
the contributions for both employers and<br />
employees have been set at 1 per cent, but<br />
from April will increase to 2 per cent for<br />
employers and 3 per cent for employees.<br />
They will increase again to 3 per cent for<br />
employers and 5 per cent for employees<br />
in April 2019. The government also plans<br />
to cut the minimum age for enrolling staff<br />
from 22 to 18 in ‘the mid 2020s’, provided<br />
their earnings are over £10,000.<br />
There are also moves to calculate<br />
contributions on all earnings up to £45,000,<br />
rather than the current ‘banded earnings’<br />
system, which calculates contributions on<br />
earnings between £5,876 and £45,000.<br />
“These two measures will have a<br />
disproportionate impact on the hair and<br />
beauty sector because of the sheer number<br />
of young people, while the banded earnings<br />
change will have a bigger impact for<br />
workers on minimum wages, also common<br />
in our industry,” warned Hilary Hall, chief<br />
executive of the NHF.<br />
SATURDAY JOBS ‘IN DECLINE’<br />
MORE THAN A quarter (28 per cent) of hair and<br />
beauty professionals started out as Saturday<br />
workers. A poll by insurer Direct Line for Business<br />
found half (50 per cent) had followed a family<br />
member into the industry, with apprenticeships<br />
and college courses (both 30 per cent) other<br />
popular routes in.<br />
Yet BBC research, based on analysis of child<br />
employment permits issued by local authorities,<br />
suggests the number of schoolchildren with<br />
a part-time job has fallen by a fi fth in the past<br />
fi ve years.<br />
‘GREY ECONOMY’ IN SPOTLIGHT<br />
THE NHF WILL focus its campaigning and lobbying activity on pushing for a<br />
fairer VAT and business rates system, restraint on employee pay and cracking<br />
down on the cash-in-hand “grey” economy.<br />
The move follows a survey of NHF members that suggested these are key<br />
concerns that many small salons and barbershops would like to see addressed.<br />
The poll of 512 members found more than half (52 per cent) backed the<br />
idea of reducing the current £85,000 threshold for registration for VAT. The<br />
government has already said it intends to consult on how to change VAT.<br />
Nearly three-quarters (72 per cent) argued that VAT should be lower than<br />
20 per cent for hair and beauty businesses.<br />
Members were also frustrated at the way growing levels of self-employment<br />
within hair and beauty are increasingly undercutting businesses that employ<br />
workers. Nearly two-thirds (63 per cent) felt businesses with employees<br />
were “disadvantaged” when competing with businesses using chair renters.<br />
More than half (55 per cent) called for chair renters to pay the same National<br />
Insurance contributions as employees.<br />
Last November’s Budget confirmed the National Living Wage for over-25s<br />
is to rise to £7.83 an hour from April. The government’s long-term aim is this<br />
wage should be £9 an hour by 2020. A significant minority (41 per cent) of<br />
members worried this would be “too much”, while 70 per cent warned that a<br />
£9 living wage would force them to raise prices, and 40 per cent said they<br />
would cut back on staff or reduce hours.<br />
Members had strong views about the Apprentice Minimum Wage rate, the<br />
complicated nature of which was blamed for salons inadvertently failing to<br />
pay apprentices the correct rate.<br />
COUNCIL PARKING FINES SOAR<br />
LOCAL COUNCILS IN England generated £819m from<br />
parking fees and fines in 2016-2017, an increase of 10<br />
per cent on the previous year. A study by the RAC<br />
Foundation found many of the highest totals were seen<br />
in London, with the largest in Westminster. Outside<br />
the capital, big surpluses were also recorded in<br />
Brighton and Hove, Milton Keynes and Birmingham.<br />
An NHF survey found clients were often deterred<br />
from booking simply because of being unable to park<br />
nearby or stay long enough for a treatment.<br />
WANT TO SELL<br />
YOUR BUSINESS?<br />
Look out for the NHF’s new<br />
guide, Selling Your Salon in<br />
association with business<br />
broker ETS Corporate, which<br />
is also off ering a subsidised deal<br />
on services to members.<br />
The guide can be<br />
downloaded at nhf.info<br />
To find out more information and how to join the NHF, call 01234 831965 or visit nhf.info<br />
26<br />
CREATIVE <strong>HEAD</strong>
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