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Everything an Employer Needs to Know about Paying an Apprentice

5 February 2019

If you’re considering taking on an apprentice, it’s always a good idea to familiarise yourself with the finer details of what it entails. In this post, we provide employers with all of the information they need to know about paying an apprentice.

An apprentice possesses many traits that are hugely beneficial for today’s businessesand, over time, they have the potential to evolve into the elite of their chosen industry. It’s for this reason that companies shouldn’t ignore the importance of apprentices and should compensate them appropriately for their hard work. Fortunately, these days, paying an apprentice an unfair amount is against the law, but we’ll get to that later!

How Much Do I Have to Pay an Apprentice?

Every apprentice working in the UK should be paid the National Minimum Wage. It’s worth noting that there is a specific minimum wage amount for apprentices, so you can opt to pay them this rate, rather than the minimum wage for their age bracket. Of course, this is only the minimum you have to pay them, and you are entitled to increase their pay or provide bonuses at your own discretion.

Any apprentice under the age of 19 or over 19 and in their first year of an apprenticeship should be paid at least £3.70 an hour. Apprentices over 19 and who have completed their first year of an apprenticeship are entitled to the National Minimum Wage for their pay. So for example, if you have a 22-year-old apprentice who has just completed their first year of an apprenticeship, they are entitled to an hourly rate of £7.38.

Pay Conditions

As an employer, you are responsible for paying an apprentice’s wage and providing a contract of employment. All apprentices should be working under a training structure that meets apprenticeship standards, as well as be employed in a job role that gives them the opportunity to learn the vital skills and knowledge they need to pass training assessments.

You should also be paying an apprentice for the time they spend training, which could be at work, college, or through an independent training organisation. Although apprentices aren’t as established or experienced as your other employees, it doesn’t mean they are any less entitled to the same or similar benefits, such as sick pay or paid holiday.​

Apprenticeship Levy

In 2017, the UK government introduced a new apprenticeship funding scheme for business owners in an attempt to create millions of new jobs for young people. Although the apprenticeship levyis used to cover the cost of training and assessment for apprentices and not their wage, it’s something that every employer should be aware of. The levy works as follows:

  • The levy applies to public and private employers across all sectors with a payroll bill in excess of £3 million a year.
  • Employers with a pay bill that’s less than £3 million a year are not eligible for the apprenticeship levy, in which case they pay 10% of the cost for training, while the government covers the remaining 90%.

The levy is set at 0.5% of the total payroll and will be collected monthly via PAYE. Employers are given a £15,000 allowance to offset against their payments and the allowance operates on a month-to-month basis. This means you’ll have an allowance of £1,250 each month and any unused funds will accumulate over the year. The government will top up all levy pots by 10%, meaning that if you spend your monthly allowance of £1,250, the government will pay an additional £125.

Paying an Apprentice More Than the Minimum Wage

The National Minimum Wage is called the “minimum” wage for a reason, meaning that an employer is entitled to pay an apprentice however much they want, as long as it meets or exceeds the minimum wage. An apprentice is an extremely valuable asset who can genuinely improve a company in many ways, and this is something that several employers recognise and why they choose to pay their apprentices more.

If your company has a unique payment structure or a scheme that provides raises and bonuses to employees based on merit, apprentices can and should be entitled to participate.

Hiring an Apprentice

Taking on apprentice differs significantly compared to hiring a regular employee, as it’s not as simple as putting out an advert and waiting for them to arrive at your door. At CCCT, we use our vast network of industry links to find you the most efficient and suitable candidate to suit your company’s needs.

Every business is different and will require a unique apprenticeship structure in terms of training and assessment, which is something we have a great deal of experience in. This allows us to provide the perfect apprenticeship framework to aid the progression of your apprentice(s).

A vital aspect of hiring an apprentice is finding the right person for the job, which can be achieved with an in-depth and widespread recruitment campaign. We provide this dedicated service free of charge. Following an initial free consultation, we will gain a better understanding of the type of candidate you’re looking for and what you’re hoping to achieve. From here, we will get to work and find them for you!

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