A petition arguing that commission payments from car sales should be included in the Government’s Coronavirus Job Retention Scheme wage calculations has attracted almost 8,000 signatures in less than two days.
Launched by the Independent Motor Dealers Association (IMDA) on Saturday (March 28) the petition – set up via the change.org website – requests that car sales workers classed as “furloughed” have their full average monthly salary, including commission payments, taken into account by the scheme’s payment offer.
The Government has said that it will pay 80% of “furloughed workers” monthly wage, up to a limit of £2,500, but many car retailers have said that using their low basic wage to calculate their income will leave them unable to cover key monthly outgoings such as mortgage payments and food during the COVID-19 coronavirus lockdown
As AM’s online story was published almost 8,000 people had signed the IMDA’s online petition.
- AM is urging car retailers to share their experience of handling the impact of the COVID-19 coronavirus outbreak with a quick-fire, three-minute, multiple choice survey. Please click here to take part.
One concerned participant in the survey said: “My husband is a car salesman and we rely on his commission as basic wage is awful and not worth the paper it's written on.
“It's not fair for any people working in this trade or any other commission-based trade to be detremented by this government.”
Spelling out his concerns, another said: “I completely understand that scarifies have to be made at this time but my wife is on maternity leave and I am the main earner. Expecting us to survive on my basic is not fair when others are being paid a much higher proportion of their wages.”
Another said: “I’ve paid tax on my full earnings which includes commission, which is 70% of my wage, now Commission based people will only get 80% of their basic pay which is very low! Even with a mortgage holiday I will still struggle to pay my bills!”
MHA MacIntyre Hudson spelled out its concerns with the Government’s job retention scheme shortly after full details were revealed late last week.
Commenting at the time, Nigel Morris, tax director at MHA MacIntyre Hudson, said: “For many in our sector, and indeed other sectors such as Motor Dealers and Estate Agents etc, the regular wage of the employee’s includes every month a very low basic, often just at national minimum or national living wage, plus commission on sales in the period.
“If the exclusion of commission in the final sentence above were to apply this would be very detrimental to all of those employees and not reflective of their regular wage.”
The National Franchised Dealers Association (NFDA) has written to Kemi Badenoch MP, Exchequer Secretary to the Treasury, to seek clarifications on the Coronavirus Job Retention Scheme.
"We urge the Government to clarify its guidance on the Job Retention Scheme as the latest information is creating uncertainty in the sector”, said director Sue Robinson.
“Monthly bonuses and commissions form a normal part of employees’ monthly ‘earnings’ in the retail automotive industry and salespeople in franchised dealerships rely heavily on the commissions they regularly receive.
“It is vital that the Government clarifies this issue as soon as possible to provide significant relief to workers operating in this key sector."
In an interview with AM last week Marshall Motor Holding chief executive, Daksh Gupta, said that his business would pay all its “furloughed workers” 90% of their salary, even if that was above the government’s £2,500 cap.
Motorpoint chief executive, Mark Carpenter, meanwhile, revealed this week that he would forego his own wage during the enforced lockdown of his car retail businesses in order to ensure that his employees were paid more than the national living wage.
In its commentary on the clarified terms of the Government’s Coronavirus Job Retention Scheme, ASE questioned the fairness of other elements of the scheme.
It branded the fact a person with several employments (the company director with several employments) is eligible for more than one £2,500 payment, branding it “grossly unfair”.