HR Support for Trade Businesses

Apprenticeships

Apprenticeships have been around since the middle ages and have a long association with industries such as carpentry, plumbing and construction as well as master craftsmen.  The master would pass along their skills to the apprentice.

Apprenticeships continued in popularity and in the 1960s it is estimated that a third of male school leavers became an apprentice.  This may often have been a father passing along skills to his child as the business name progressed to include “and son”.  Recently we were delighted to see a plumber’s van with “and daughters” added to the company name!

These were not regulated by Government and focussed very much on time served rather than achieving a specified level of skill. The number of apprenticeships declined as employers began to question their usefulness.

Various initiatives were then introduced (anyone remember YTS?) but unfortunately these were viewed as low quality and seen by many as a way of the Government simply massaging the unemployment figures with low paid training schemes.

Fast forward to the 1990s when Modern Apprenticeships were introduced to provide apprentices aged 16 to 24 with an NVQ qualification, and then more up to date when in 2017 the Government introduced the Apprenticeship Levy for any employer with a salary bill of over £3 million.

But what does this mean for your business?  It can seem a complex minefield to try to navigate!

Small businesses are non-levy paying employers which means you share the cost of training and assessing your apprentices with the Government – this is called ‘co-investment’.  The co-investment rate was 10% of the cost of the training but for new apprenticeships starting on or after 1 April 2019, you will now pay 5% towards the cost of apprenticeship training. The Government will pay the rest (95%) up to the funding band maximum.  This means the training is usually at a very low cost to you.  It may all be done in the workplace with an apprentice assessor coming to you, or it may involve some day release time to college.

Gone are NVQs with qualifications now fitting into a framework that puts them alongside GCSEs, A Levels and Degrees, with the range of jobs that can be taken on as an apprenticeship being widely expanded – although that does depend on finding a college or training provider that can support that particular training.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/787717/Guide-to-Apprenticeships-260219-LR.pdf

Another key change is that apprenticeships are open to everyone over the age of 16 – they are no longer just for younger employees leaving education.

There is an apprenticeship rate of National Minimum Wage that applies apprentices aged under 19, or aged 19 and over and in the first year of their apprenticeship.  This reflects that they are not yet a skilled and experienced member of your team. Apprentices aged 25 and over, and not in the first year of their apprenticeship, are however entitled to the prevailing normal rate of National Minimum Wage.

Apprentices used to have a special status that put them outside of many of the regular employment rules, rights and regulations, and could make it difficult for an employer to terminate the arrangement if it was not working.  This was changed, ad an apprenticeship is now a Contract of Employment for a fixed term of the apprenticeship duration.  Employers can therefore treat the apprentice in the same way as they can any other employee which minimises the risks and keeps things simpler.

Apprenticeships can offer your business a great way to bring in fresh new talent that you can train to work in the ways you value.  It is not an easy option if you are just looking for cheap labour!