10 things SMEs should know about apprenticeships

To mark the start of National Apprenticeship Week 2018, we aim to bust some of the myths surrounding apprenticeships when it comes to SMEs. The Government plans to increase the number of apprenticeships to around three million by 2020, so now is the time for all businesses to investigate the benefits.

Apprenticeships are no longer just for big businesses

Traditionally reserved for big businesses with big budgets, apprenticeships now come in all shapes and sizes – making them viable options for SMEs. Research from the National Apprenticeship Service last year showed that:

      • More than 24,000 apprentice-employing SMEs in the private sector reported that hiring an apprentice helped them win business
      • 3 in 4 SMEs employing apprentices reported an increase in productivity
      • 96% of SMEs reported at least one business benefit to hiring an apprentice

Funding is available

Businesses with a wage bill of less than £3m can claim 90% of their apprenticeship training costs back, or 100% if the apprentice is 16 – 18 years old. In addition, those employing young people or those who have been in social care, could also receive a grant of £1000.

You can create your own scheme to suit your business

As part of its reforms last year, the Government now allows firms to design their own schemes with bolt-ons to suit their own business needs. Before you embark on a pilot scheme, you will need to choose the relevant apprenticeship framework or standard and determine the level of apprenticeship that meets your business needs.

The number of apprentices completing advanced programmes is rising

Despite the dismal stats released last year on the take-up of apprenticeship places, the number of apprentice advanced or higher programmes has risen. Advanced schemes are equivalent to 2 A level passes, higher levels are equivalent to foundation degree level and above.

Apprenticeships vary in length, but must be for at least one year

Many can last as long as five years, depending on the level of apprenticeship.

Apprentices can be new or an existing members of staff

Apprenticeships are not limited to new recruits; existing staff members can embark on a scheme.

Your apprentice must have an employment contract that lasts at least as long as the length of the apprenticeship

However, your standard employee contract may not be sufficient. An apprenticeship agreement must be signed by both the apprentice and the employer at the start if any apprenticeship This needs to specify the length of employment, training, working conditions and the qualifications they will receive as well as a statement of the skill, trade or occupation for which the apprenticeship is being trained for.

You must pay no less than the Apprenticeship Minimum Wage

This is £3.50 for apprentices age 16 – 18, rising to £3.70 from April 2018. The same applies for apprentices 19 and over and in the first year of their apprenticeship, after that they are entitled to the National Minimum Wage.

All apprentices are expected to work a minimum 30 hours per week

Many of the special protections in the regulations for young workers under 18 will apply to apprentices.

Employers are also not required to pay national insurance contributions for their apprentices if under the age of 25

Thinking of starting a scheme? Read our beginners guide…