Apprenticeships: What are the employer benefits?
Are you considering hiring an apprentice or upskilling a current employee through an apprenticeship? If so, apprentices are an exciting opportunity for both the apprentice and the employer.
As an employer, you can get help from the Government to pay for apprenticeship training. The amount you get will depend on whether you pay the Apprenticeship Levy or not. You pay the levy if you’re an employer with a wage bill of more than £3 million each year.
Funding an apprenticeship for levy payers:
As an employer with a wage bill over £3 million each year, you’ll automatically pay into the Apprenticeship Levy Pot. Funds are managed through your DAS account, and you can spend funds on training new recruits or existing colleagues. The Government will apply a 10% top-up to the funds you have in your account. If you don’t have enough funds to cover the full cost of the apprenticeship training, you will only pay 5% of the outstanding balance and the Government will pay the rest.
You can find out how to set up a Digital Apprentice Service account here.
There are incentives in place to help encourage businesses to hire a new apprentice. Payment incentives have been increased for employers hiring a new apprentice and are applicable for starts before the 30th of September 2021. Employers will receive £3000 for new apprentices of any age who join their organisations before the end of September. Employers can apply for these incentive payments between 1st June 2021 – 30th September 2021.
Funding an apprenticeship for non-levy employers:
As an employer that doesn’t pay the Apprenticeship Levy, you will only pay 5% towards the cost of apprenticeship training. A payment schedule will be agreed between yourself, and the training provider and funds will be paid directly to them.
Do you have less than 50 employees in your business? If so, the Government will pay 100% of the apprenticeship training costs up to the funding band maximum for apprentices who are aged:
- 16 – 18
- 19 – 24 with an education, health and care plan provided by their local authority, or has been in the care of their local authority
The incentives for hiring an apprentice are the same for non-levy employers and levy paying employers.
As an employer, you can either hire a new employee as an apprentice or invest in your current workforce, by upskilling them through an apprenticeship.
To help you decide if apprenticeships are right for your business, check out the benefits of having an apprentice in your organisation blog.
Apprenticeships are an effective way to grow talent and develop a motivated, skilled, and qualified workforce, but the benefits don’t stop there. So, whether you are looking to plug a skills gap using apprenticeships, or nurture your existing talent by upskilling them, what’s not to love about an apprenticeship? Take a look at our current apprenticeship training here.