Hiring an apprentice

Apprenticeships provide an opportunity for people embarking upon a new career to combine hands on experience with related study, in order to gain specific skills and knowledge of a certain job or industry.

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What is an apprentice?

An apprentice is someone aged 16 or over who is carrying out a work-based training programme (an apprenticeship) which offers on-the-job training together with nationally recognised qualifications. Apprenticeships can last for 1 - 5 years and are available in 1,500 occupations across 170 industries.

Why hire an apprentice?

Aside from helping to train the workforce of the future and improving their credentials as an employee, running an apprenticeship programme can provide businesses with a bespoke recruitment drive, allowing them to assess potential new employees while more experienced staff pass down their skills so these are retained within the business. Organisations which provide off-the-job training (eg colleges and universities) can work with the business to ensure that the study element is more relevant for the particular job.

Although employers must pay their apprentices (at the current rate of the national minimum wage), certain government funding is available (see below). Furthermore, there is no requirement for National Insurance Contributions for apprentices under the age of 25 on earnings below the higher tax rate. For further information read Minimum wage.

What funding is available?

Employers with an annual pay bill of over £3 million must pay a levy towards an apprenticeship fund; they can later spend what they have paid into this fund on apprenticeship training. Non-levy paying employers will be eligible to claim 90% of training costs from the government.

Employers with fewer than 50 employees can claim 100% of training costs if they take on apprentices who are 16 - 18 (or 19 - 24 if they have previously been in care or have a Local Authority Education, Health and Care Plan).

All employers can claim £1,500 for each apprentice they take on who is 16 - 18 (or 19 - 24 if they have previously been in care or have a Local Authority Education, Health and Care Plan).

For more information on the levy system and on how to obtain funding, see the GOV.UK website.

How do you hire an apprentice?

The first step to hiring an apprentice is to choose the appropriate apprenticeship framework (old system) or standard (new system) to suit the particular industry and the level of qualification (eg equivalent to GCSE, A-Level, degree etc); this is done using the online service. Employers must then find an appropriate apprenticeship training provider.

Once funding has been determined, the apprenticeship can then be advertised via the relevant training organisation. Following selection of the apprentice, an apprenticeship agreement must be formed and a commitment statement signed.

What is an apprenticeship agreement?

An apprenticeship agreement must be signed prior to the start of any apprenticeship. Amongst other things, it should:

  • include a statement of the skill, trade or occupation for which the apprentice is being trained
  • confirm the individual employment arrangements between the apprentice and the employer
  • state the relevant apprenticeship framework or standard and level
  • the expected length of the apprenticeship

A commitment statement should also be signed which details the planned content and schedule for training, and what is expected and offered by all relevant parties (ie apprentice, employer and training organisation).

The apprenticeship agreement is not a substitute for an employment contract and it must be incorporated into the contract of employment.

What is the minimum wage for apprentices?

Employers must pay apprentices at the Apprenticeship rate of the national minimum wage (£3.90 until April 2020). These NMW rates change every April. For further information read Minimum wage.

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