NEWS RELEASE: EMPLOYERS TO FACE INCREASED EMPLOYMENT COSTS FROM JANUARY 2014 - MOVE WILL COST JOBS - GOVERNMENT URGED TO EXTEND REDUCED EMPLOYERS' PRSI RATE TO END 2014
RGDATA, the representative association for 4,000 local shops, supermarkets and convenience stores, is today urging Finance Minister Michael Noonan to extend the reduced Employers' PRSI rate for workers earning under €356 for a further 12 months. RGDATA said that the extension is required to support and sustain employment in the sector at a particularly vulnerable time for employers.
"Minister Noonan introduced a reduced 4.25% rate of Employers' PRSI for low paid workers when he first announced the reduced VAT rate for the hospitality sector. RGDATA welcomes his announcement of an extension of the 9% VAT rate which also applies to newspapers. However we are deeply disappointed and concerned that he has not extended the lower Employers' PRSI rate for another 12 months," said RGDATA Director General Tara Buckley.
Buckley said the reduced Employers' PRSI has been an important measure for the independent retail sector and has enabled retailers to keep staff in jobs and to create jobs. However the rate is due to revert to 8.5% from January 1 2014. This will cost a typical supermarket that employ significant numbers of part time staff who earn less than €356 a week up to €60,000 more in increased employment costs in 2014. This is completely unsustainable and at odds with the Government's job creation goals.
"Shop owners, who are struggling to keep their shops open and their staff in jobs, are reeling at the implications of the Employers' PRSI rate for workers earning under €356 increasing from January 1 next. RGDATA has written to Minister Noonan urging him to extend this provision to the end of 2014," said Buckley. "While there are some signs of growth in the economy, at the retail level any signs of an improvement in the economy are hard to detect. Retailers are not out of the woods yet and face another difficult year in 2014. Increasing the costs of employment at this vulnerable time will lead to further job losses and more business failures. Now is not the time for new costs to be piled on employers operating in challenged sectors."
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