Information for Employers

Making apprenticeships work for you

Are you an employer looking at taking on an apprentice or thinking about putting existing staff on an Apprenticeship scheme? You would be joining one of over 260,000 workplaces that provide apprenticeship places.

Why Apprenticeships?

Looking at taking on an apprentice? Or, looking to put existing staff on an Apprenticeship scheme? You're joining one of over 260,000 workplaces that provide apprenticeship places.

Apprenticeships can help businesses across all sectors by offering a route to harness fresh new talent. UK businesses consider skills shortages and recruitment difficulties the biggest threats to performance and growth, and more than a quarter of these rate this form of vocational training higher than any other qualification.

Apprenticeships ensure that your workforce has the practical skills and qualifications your organisation needs now and in the future. The mixture of on and off job learning ensures they learn the skills that work best for your business.

Workplaces offer apprentice places because they understand the benefits that apprentices bring to their business - increased productivity, improved competitiveness and a committed and competent work-force.

The benefits of having an apprentice are increased productivity and training someone my way. I have been his mentor throughout and it has also allowed me more time to do the administration side of the business such as answering phone calls.
HB Motor Cycle
Employer

The Apprenticeship Levy

Since the general election in 2015, apprenticeships have been a major government priority to improve skills and productivity in the UK. In order to support this the government is making significant changes to how apprenticeships are funded.

  • Funding will be directly in the hands of employers
  • Funding will come through the Apprenticeship Levy
  • Employers with a wage bill in excess of £3million per year will pay 0.5% of their total wage bill into the Levy minus a Levy allowance of £15,000 from the government for example:
    Annual Wage Bill £10million = £50,000 (0.5%) - £15,000 Levy allowance = £35,000 into your ‘Apprenticeship Levy Pot’.
  • The Levy will be payable through PAYE and held in an ‘Apprenticeship Levy Pot’
  • There will be a new ‘Digital Apprenticeship Service’ which will allow employers to see how much money is in their ‘pot’ to pay for apprenticeship training
  • The government will pay a 10% top up to the funds that you pay into your ‘pot’
  • All employers will receive a £1,000 payment for taking on a 16-18 year old on an apprenticeship framework or standard, as well as 19-24 year olds who were formerly in care or who have an Education and Health Care plan. The payment will be made in the third and twelfth month and will initially be made by the training provider. Over time, it is intended that the payment will be made directly from the government.

The levy will be paid by employers in any sector with a pay bill of more than £3 million per year, and will be charged at 0.5%. The levy will be paid to HMRC through PAYE. You will calculate, report and pay your levy to HMRC, through the PAYE process alongside tax and National Insurance Contributions (NIC). If you have calculated that you will pay the apprenticeship levy, you will need to declare this and include it in your usual PAYE payment to HMRC.

The pay bill will be calculated based on the total amount of earnings subject to Class 1 secondary NICs. Earnings include any remuneration or profit coming from employment, such as wages, bonuses, commissions, and pension contributions that you pay NICs on.

You will pay the levy on your entire pay bill at a rate of 0.5%. However, you will have a levy allowance to offset against this. The levy allowance is worth £15,000 for each tax year.

This means the levy is only payable on pay bills over £3 million (because 0.5% x £3 million = £15,000).

Example:
Annual pay bill of £7,000,000
Apprenticeship levy of 0.5% x £7,000,000 = £35,000
Minus £15,000 allowance = £20,000 annual levy payment

Funds will be accessed through a new digital apprenticeship service account. This service is now open for registration. Employers will need to register to create an account, and link it to their PAYE schemes. You will be able to see funds appear in your digital account monthly.

Employers will be able to use this to pay for training and assessment for apprentices in England. The service will also help employers find training providers and assessment organisations.

When you agree to buy apprenticeship training from a particular training provider and the apprenticeship has started, monthly payments will automatically be taken from your digital account and sent to the provider.

The digital apprenticeship service will support the English apprenticeship system. Scotland, Wales and Northern Ireland will have their own arrangements for supporting employers to access apprenticeships.

Funds in your digital account can only be used towards the costs of apprenticeship training and end point assessment. This must be with an approved training provider and assessment organisation.

For employers that wish to provide apprenticeship training themselves, they must become an approved training provider.

Funds can’t be used on other costs associated with apprentices or wider training effort. For example wages, statutory licences to practise, travel and subsidiary costs, managerial costs, traineeships, work placement programmes or the costs of setting up an apprenticeship programme.

Government will apply a 10% top-up to the funds you have to spend on apprenticeship training in England. It will be given monthly, at the same time the funds enter your digital account. That means for every £1 that enters your digital account to spend in England on apprenticeship training, you get £1.10.

Funds will expire 24 months after they enter your digital account if you don’t spend them on apprenticeship training; this will also apply to any top-ups. Your digital account will let you know in good time when any funds are due to expire so that you can arrange to spend them.

If you don’t have enough in your account in a particular month, you will be asked to make a contribution to the extra cost of training and to pay this directly to the provider, rather than through your digital account. You will be able to spread this contribution over the lifetime of the apprenticeship and agree a payment schedule with your provider. To help meet these additional costs, the government will pay 90% towards the extra cost of training and assessment with employers paying the remaining 10%.

All apprentices who started their apprenticeship programme before April 2017 will be funded for the full duration of their apprenticeship under the terms and conditions that were in place at the time the apprenticeship started. If you pay the apprenticeship levy, you will not be able to use the funds in your digital account to pay for these apprenticeships.

Note: If you have an apprentice who is due to complete their current apprenticeship level by April 2017 and is wanting to progress onto the next level, then the new level will be subject to the apprenticeship levy.

Where a group of employers are connected they will only be able to use one £15,000 allowance. If you are part of a group of connected employers, you must decide what proportion of the levy allowance each employer in the group will be entitled to. This decision must be taken at the beginning of the tax year and will be fixed for that tax year.

If you don’t pay the levy, you won’t need to use the digital apprenticeship service to pay for apprenticeship training and assessment until at least 2018.

But, when the new funding system begins in April 2017, you can access the digital apprenticeship service to choose the training provider, and assessment organisation for your apprenticeship programme using the registers available.

Employers that don’t pay the levy will be expected to contribute towards the cost of apprenticeship training, and Government will pay the rest (up to the maximum amount of funding available in the band for that apprenticeship). More details on the proposed rate of government support will be available in June 2016, and will be confirmed in October 2016.

All employers will receive a £1,000 payment for taking on a 16-18 year old on an apprenticeship framework or standard, as well as 19-24 year olds who were formerly in care or who have an Education and Health Care plan. The payment will be made in the third and twelfth month and will initially be made by the training provider. Over time, it is intended that the payment will be made directly from the government.

Annual wage bill of <£3 million, > 50 employees

Employers who do not pay the levy will benefit from significant government funding to support their commitment to apprenticeships. As of 1 April 2019, Employers will need to make a financial contribution – ‘co-investment’ of 5% of the cost of training and assessment. In the first 12 months employers will need to pay their co-investment directly to training providers, however overtime this will move to a digital account. Payment schedule can be agreed with the provider.

Annual wage bill <£3m, <50 employees

Employers with less than 50 employees will be able to train 16-18 year old apprentices without making a contribution. Apprentices aged 19 – 24, previously in care or who have an educational or health care plan, will also be fully funded. Employers will need to make a financial contribution – ‘co-investment’ of 5% of the cost of training and assessment for apprentices aged 19 and over.

Education and training is a devolved policy, which means that authorities in each of the UK nations manage their own apprenticeship programmes. Government are working with the devolved administrations to make this work for employers that have operations across the UK, and will publish more details in June 2016. The current advice is to contact the relevant apprenticeship authority for more information about funding in other parts of the UK.

Employers can use the digital apprenticeship service whether they pay the levy or not. They will help employers to:

  • select an apprenticeship framework or standard
  • choose the training provider or providers you want to deliver the training
  • choose an assessment organisation
  • post apprenticeship vacancies

From April 2017, employers that pay the levy will also be able to:

  • see the funds you have available to spend in England
  • set the price you’ve agreed with your training provider
  • pay for apprenticeship training and assessment through the digital apprenticeship service
  • By 2020, all employers will be able to use the digital apprenticeship service to pay for training and assessment for apprenticeships

Please check the Skills Funding Agency blog for further information and updates

Changes are occurring all the time, so ensure you register with us so we can keep you appraised of these changes

  • We will send you regular email updates, which you can opt-out of at any time
  • You will be invited to attend special ‘Apprenticeship Levy’ briefings at various locations around the District at various times of the day and evening to hopefully suit your business
  • This link will take you to the government website where you can get the latest updates and more detailed information as it stands at the moment.

If you wish to discuss the Apprenticeship Levy or register for email updates, please call Business Development on 01924 789761.

The benefits of having an apprentice are increased productivity and training someone my way. I have been his mentor throughout and it has also allowed me more time to do the administration side of the business such as answering phone calls.
HB Motor Cycle
Employer

How Apprenticeships can help your business

There are many benefits to be gained from employing an apprentice.

  • Reducing staff turnover.
  • Offering a route to harness fresh new talent. Your apprentice is with you because they want to be - they made the decision to pursue this particular career path and will therefore be more likely to be enthusiastic, motivated and loyal to your company.
  • You can realise increased productivity, improved competitiveness and a combined and competent workforce.
  • Providing local young people the chance to train, learn, earn in work environment.
  • Motivating the workforce
  • Increase competition.
  • Avoiding skills shortages. Apprentices help you fill your skills gaps. They develop the specialist skills you need to keep pace with the latest technology and working practices in your sector.
  • Enabling staff to work towards a qualification.
  • Improving morale of staff.
  • Reducing training costs - it is said that training apprentices is more cost effective than hiring skilled staff, leading to lower overall training and recruitment costs.
  • Training managers of the future. It is widely held that a high proportion of apprentices go on to management positions within their company.
  • Bring in fresh ideas and new ways of thinking.

Over 260,000 workplace offer apprentice places because they understand the benefits that apprentices bring to their business. By offering Apprenticeships you ensure that your workforce has the practical skills and qualifications your organisation needs now and in the future.

  • A new member of staff joins you and works with you for a minimum of 30 hours.
  • For a set period of the working week, you release the apprentice and they use that time to work with trained staff from college. During this time, they are trained in that subject area and complete a framework of skills.
  • This generally means them coming into college and building the skills which they then take back into your business.
  • Apprentices complete a Diploma which gives them knowledge for each vocational area.
  • Contact the apprenticeship office for more guidance and to support you in recruiting the right apprentice for your business.
Why should I have my current members of staff becoming apprentices?
It’s a good opportunity. They are then upskilled in their sector, and as a result become more productive, have higher morale and produce higher quality work than similar employees.

What’s the benefit for me?
As an employer, you benefit from low cost, value-adding training tailored to your business requirements.

You will also gain from having motivated and well trained staff with essential skills, enhanced staff morale, better employee retention rates and improved efficiency and productivity.

The apprentice spends most of their time working in your premises, and will attend college-based learning. Employers use apprenticeship programmes to identify the leaders and managers of the future.

The mixture of on-and off-the-job learning ensures they learn the skills that work best for your business.

  • You agree to release your member of staff to complete an apprenticeship.
  • During this time, they are trained in that subject area and complete a framework of skills.
  • For a set period of the working week, you release the apprentice and they use that time to work with trained staff from college. During this time, they are trained in that subject area and complete a framework of skills.
  • This generally means them coming into college and building the skills which they then take back into your business.
  • Apprentices complete a technical certificate which gives them knowledge for each vocational area.
  • There are various types of apprenticeships at various levels.
  • For more information contact the apprenticeship office and personal guidance.

If you are a member of the CITB you may be eligible for an Apprenticeship Grant. For further information and details on how to apply, please visit www.citb.co.uk

Grants are available for up to £2,000 for businessses with 249 or fewer employees to recruit an apprentice. Businesses based in Bradford, Calderdale, Kirklees, Leeds, Wakefield or York, depending on certain criteria being met.

The AGE Grant is administered by the Leeds City Region Enterprise Partnership (LEP).

For full details of eligibility please visit: http://www.the-lep.com/for-business/skills-and-training/apprenticeship-support-and-funding/lep-apprenticeship-grant/.

Coming back to College as an adult apprentice has been great as it has given me the opportunity to study something I’m interested in and to learn something new which will help me in my career.
David
Electronics and Electrical Engineering Apprentice

The Apprenticeship Levy

Since the general election in 2015, apprenticeships have been a major government priority to improve skills and productivity in the UK. In order to support this the government is making significant changes to how apprenticeships are funded.

  • Funding will be directly in the hands of employers
  • Funding will come through the Apprenticeship Levy
  • Employers with a wage bill in excess of £3million per year will pay 0.5% of their total wage bill into the Levy minus a Levy allowance of £15,000 from the government for example:
    Annual Wage Bill £10million = £50,000 (0.5%) - £15,000 Levy allowance = £35,000 into your ‘Apprenticeship Levy Pot’.
  • The Levy will be payable through PAYE and held in an ‘Apprenticeship Levy Pot’
  • There will be a new ‘Digital Apprenticeship Service’ which will allow employers to see how much money is in their ‘pot’ to pay for apprenticeship training
  • The government will pay a 10% top up to the funds that you pay into your ‘pot’
  • All employers will receive a £1,000 payment for taking on a 16-18 year old on an apprenticeship framework or standard, as well as 19-24 year olds who were formerly in care or who have an Education and Health Care plan. The payment will be made in the third and twelfth month and will initially be made by the training provider. Over time, it is intended that the payment will be made directly from the government.

The levy will be paid by employers in any sector with a pay bill of more than £3 million per year, and will be charged at 0.5%. The levy will be paid to HMRC through PAYE. You will calculate, report and pay your levy to HMRC, through the PAYE process alongside tax and National Insurance Contributions (NIC). If you have calculated that you will pay the apprenticeship levy, you will need to declare this and include it in your usual PAYE payment to HMRC.

The pay bill will be calculated based on the total amount of earnings subject to Class 1 secondary NICs. Earnings include any remuneration or profit coming from employment, such as wages, bonuses, commissions, and pension contributions that you pay NICs on.

You will pay the levy on your entire pay bill at a rate of 0.5%. However, you will have a levy allowance to offset against this. The levy allowance is worth £15,000 for each tax year.

This means the levy is only payable on pay bills over £3 million (because 0.5% x £3 million = £15,000).

Example:
Annual pay bill of £7,000,000
Apprenticeship levy of 0.5% x £7,000,000 = £35,000
Minus £15,000 allowance = £20,000 annual levy payment

Funds will be accessed through a new digital apprenticeship service account. This service is now open for registration. Employers will need to register to create an account, and link it to their PAYE schemes. You will be able to see funds appear in your digital account monthly.

Employers will be able to use this to pay for training and assessment for apprentices in England. The service will also help employers find training providers and assessment organisations.

When you agree to buy apprenticeship training from a particular training provider and the apprenticeship has started, monthly payments will automatically be taken from your digital account and sent to the provider.

The digital apprenticeship service will support the English apprenticeship system. Scotland, Wales and Northern Ireland will have their own arrangements for supporting employers to access apprenticeships.

Funds in your digital account can only be used towards the costs of apprenticeship training and end point assessment. This must be with an approved training provider and assessment organisation.

For employers that wish to provide apprenticeship training themselves, they must become an approved training provider.

Funds can’t be used on other costs associated with apprentices or wider training effort. For example wages, statutory licences to practise, travel and subsidiary costs, managerial costs, traineeships, work placement programmes or the costs of setting up an apprenticeship programme.

Government will apply a 10% top-up to the funds you have to spend on apprenticeship training in England. It will be given monthly, at the same time the funds enter your digital account. That means for every £1 that enters your digital account to spend in England on apprenticeship training, you get £1.10.

Funds will expire 24 months after they enter your digital account if you don’t spend them on apprenticeship training; this will also apply to any top-ups. Your digital account will let you know in good time when any funds are due to expire so that you can arrange to spend them.

If you don’t have enough in your account in a particular month, you will be asked to make a contribution to the extra cost of training and to pay this directly to the provider, rather than through your digital account. You will be able to spread this contribution over the lifetime of the apprenticeship and agree a payment schedule with your provider. To help meet these additional costs, the government will pay 90% towards the extra cost of training and assessment with employers paying the remaining 10%.

All apprentices who started their apprenticeship programme before April 2017 will be funded for the full duration of their apprenticeship under the terms and conditions that were in place at the time the apprenticeship started. If you pay the apprenticeship levy, you will not be able to use the funds in your digital account to pay for these apprenticeships.

Note: If you have an apprentice who is due to complete their current apprenticeship level by April 2017 and is wanting to progress onto the next level, then the new level will be subject to the apprenticeship levy.

Where a group of employers are connected they will only be able to use one £15,000 allowance. If you are part of a group of connected employers, you must decide what proportion of the levy allowance each employer in the group will be entitled to. This decision must be taken at the beginning of the tax year and will be fixed for that tax year.

If you don’t pay the levy, you won’t need to use the digital apprenticeship service to pay for apprenticeship training and assessment until at least 2018.

But, when the new funding system begins in April 2017, you can access the digital apprenticeship service to choose the training provider, and assessment organisation for your apprenticeship programme using the registers available.

Employers that don’t pay the levy will be expected to contribute towards the cost of apprenticeship training, and Government will pay the rest (up to the maximum amount of funding available in the band for that apprenticeship). More details on the proposed rate of government support will be available in June 2016, and will be confirmed in October 2016.

All employers will receive a £1,000 payment for taking on a 16-18 year old on an apprenticeship framework or standard, as well as 19-24 year olds who were formerly in care or who have an Education and Health Care plan. The payment will be made in the third and twelfth month and will initially be made by the training provider. Over time, it is intended that the payment will be made directly from the government.

Annual wage bill of <£3 million, > 50 employees

Employers who do not pay the levy will benefit from significant government funding to support their commitment to apprenticeships. As of 1 April 2019, Employers will need to make a financial contribution – ‘co-investment’ of 5% of the cost of training and assessment. In the first 12 months employers will need to pay their co-investment directly to training providers, however overtime this will move to a digital account. Payment schedule can be agreed with the provider.

Annual wage bill <£3m, <50 employees

Employers with less than 50 employees will be able to train 16-18 year old apprentices without making a contribution. Apprentices aged 19 – 24, previously in care or who have an educational or health care plan, will also be fully funded. Employers will need to make a financial contribution – ‘co-investment’ of 5% of the cost of training and assessment for apprentices aged 19 and over.

Education and training is a devolved policy, which means that authorities in each of the UK nations manage their own apprenticeship programmes. Government are working with the devolved administrations to make this work for employers that have operations across the UK, and will publish more details in June 2016. The current advice is to contact the relevant apprenticeship authority for more information about funding in other parts of the UK.

Employers can use the digital apprenticeship service whether they pay the levy or not. They will help employers to:

  • select an apprenticeship framework or standard
  • choose the training provider or providers you want to deliver the training
  • choose an assessment organisation
  • post apprenticeship vacancies

From April 2017, employers that pay the levy will also be able to:

  • see the funds you have available to spend in England
  • set the price you’ve agreed with your training provider
  • pay for apprenticeship training and assessment through the digital apprenticeship service
  • By 2020, all employers will be able to use the digital apprenticeship service to pay for training and assessment for apprenticeships

Please check the Skills Funding Agency blog for further information and updates

Changes are occurring all the time, so ensure you register with us so we can keep you appraised of these changes

  • We will send you regular email updates, which you can opt-out of at any time
  • You will be invited to attend special ‘Apprenticeship Levy’ briefings at various locations around the District at various times of the day and evening to hopefully suit your business
  • This link will take you to the government website where you can get the latest updates and more detailed information as it stands at the moment.

If you wish to discuss the Apprenticeship Levy or register for email updates, please call Business Development on 01924 789761.

The benefits of having an apprentice are increased productivity and training someone my way. I have been his mentor throughout and it has also allowed me more time to do the administration side of the business such as answering phone calls.
HB Motor Cycle
Employer

Frequently Asked Questions From Employers

Because it makes good business sense. Today, more than 100,000 employers are using apprenticeships to improve their business performance.

  • Apprenticeship schemes are developed to meet the needs of employers.
  • There’s a clear return on investment and a chance to upskill your workforce.
  • You have a member of staff who learns skills from you and is trained cost effectively.
  • The government contributes to the cost of the training, saving you money.
  • It motivates and improves the confidence of current employees.
  • Apprenticeships indirectly increase productivity and improve retention.

Apprenticeship programmes are available to anyone aged 16 and over and are available to both new and existing employees. You can either choose to recruit an apprentice, or place an existing employee on the programme. Exemptions do apply to a minority of applicants but by calling our department we will be able to advise.

What will it cost me?

Apprenticeships are about working together. You are responsible for paying your apprentice a wage, the current minimum amount for apprenticeships is £3.90 per hour.

For anyone up to the age of 19, the apprenticeship is funded by the government. After this, we ask for a small contribution from the employer.

You will need to provide on the job training support and a safe working environment, contribute towards your apprentice’s reviews and allow them time off to attend college.

Apprenticeships are about working together. You are responsible for paying your apprentice a wage, the current minimum amount for apprenticeships is £3.90 per hour.

For anyone up to the age of 19, the apprenticeship is funded by the government. After this, we ask for a small contribution from the employer.

You will need to provide on the job training support and a safe working environment, contribute towards your apprentice’s reviews and allow them time off to attend college.

As well as helping with the recruitment process we help and support you from start to finish. When you take on an apprentice, we appoint an account mentor to become your key point of contact with the college. The mentor works with you to follow the progress of the apprentice and is available to you should any issues arise.

  • Full assistance and support with recruitment, selection and assessments of candidates.
  • Regular visits for updates on attendance and progress.
  • Delivery of a Diploma, Functional Skills, NVQ assessment and portfolio guidance.

Firstly we need to discuss your specific training requirements and business needs. From here we can work with you to find the most suitable applicant, or assess the ability of an existing employee. We then help you with the whole process; whether it is screening existing employees or assisting with interview procedures, through to selection.