Big Table considers cutting hours in response to Budget

Chief executive Alan Morgan told The Telegraph​​​ that options being considered by the group includes reducing opening hours and cutting staff numbers, as well as price increases.

“Nothing is out of scope at the moment as the damage caused by the National Insurance changes will be substantial,” he said.

Big Table operates the Banana Tree, Las Iguanas and Bella Italia brands, among others, and has more than 220 restaurants across the UK.

Morgan was one of more than 200 hospitality leaders to sign a letter this week, which called on Chancellor Rachel Reeves to rethink her plans to raise NICs​​, warning that it will lead to business closures and job losses.

Reeves confirmed during last month’s Budget​​ that NICs for employers will go up from 13.8% to 15% in April next year, with the threshold at which businesses start paying National Insurance on a workers' earnings lowered from £9,100 to £5,000.

Additionally, the National Living Wage, the minimum wage for those 21 and over, is set to increase by 6.7%​​ to £12.21 per hour, while the minimum wage rate for 18 to 20-year-olds will rise 16.3% to £10 per hour.

The letter described hospitality as being ‘disproportionately affected’ by the changes to NICs, with the lowering of the threshold bringing in thousands of part-time staff that were previously never affected.

Recent analysis by UKHospitality​​ found that the employment tax measures outlined in the Budget will increase the cost of employing a student working 14 hours by £1,140 per month.

“The changes to the NICs threshold are not just unsustainable for our businesses,” the letter said.

“They are regressive in their impact on lower earners and will impact flexible working practices which many older workers and parents rely upon. Unquestionably they will lead to business closures and job losses within a year.

“The threshold change brings many team members into employer NICs for the first time. We estimate the threshold change may be four times the cost of the new headline rate.

“There is no capacity to pass the costs onto customers. Businesses would be reluctantly forced to raise prices by 6-8%, fuelling inflation, yet could not realistically do so as our customers are at the end of their ability to pay more. Instead, many businesses would have to reconsider investment and drastically cut jobs and reduce the hours of team members.”

The letter went on to suggest two measures that could help mitigate the impact of the employment tax measures.

They included creating a new employer NICs band from £5,000 to £9,100 with a lower rate of 5%; and implementing an exemption for lower band taxpayers working fewer than 20 hours per week.