Updated 4 March 2021: The government will extend and increase the payments made to employers in England who hire new apprentices. Employers who hire a new apprentice between 1 April 2021 and 30 September 2021 will receive £3,000 per new hire, compared with £1,500 per new apprentice hire (or £2,000 for those aged 24 and under) under the previous scheme. This is in addition to the existing £1,000 payment the government provides for all new 16-18 year-old apprentices and those aged under 25 with an Education, Health and Care Plan, where that applies.
These incentive payments are different to the levy i.e. they do not have to directly contribute to training costs. They can be used to support any organisational costs, such as facilities, and can even be used to pay the apprentice’s salary.
What are the eligibility requirements and how can you apply?
The incentive grants only apply to new apprentices to the business. If you are looking to use apprenticeship training to upskill existing staff, these incentives would not apply. The apprentice’s contract of employment must have a start date of no earlier than 1 April 2021. You can receive the incentives for an apprentice who has previously been made redundant, but they must be new to your business.
The grants (with the exception of the pre-existing £1,000 grant for 16-18 year olds) are set to expire in September i.e. the apprentice’s contract of employment must have a start date of no later than 30 September 2021. Recruiting a new apprentice, just like any other new employee, can take up to a couple of months. We need to agree the job role and appropriate apprenticeship standard, advertise the vacancy, screen applicants and provide you with suitable CVs. You need to shortlist, conduct interviews (see our article on apprenticeship recruitment and social distancing), appoint your chosen candidate and agree a start date (which could be subject to a notice period). If you are thinking of taking advantage of the incentives, we would recommend that you get in touch as early as possible so that we can get the ball rolling for you.
Access and Payments
You need to create an apprenticeship service account and add the apprentice to it. This is the system that apprenticeship levy payers have been using over the last couple of years to manage their apprentices but will be new to nearly all SMEs. Here at Damar Training, we have experienced account managers who can guide you through the process of how to get your business set up on the system, add your apprentices and apply for the incentive payments.
You will receive the incentive payment in two equal instalments: 50% after the apprentice completes 90 days of their apprenticeship and the remaining 50% after 365 days. To get the full payment, the apprentice must still be in employment and training after one year. Payments are made on the 10th working day of the month.
Find Out More
Whether you’re a levy payer or SME, we can help you recruit an apprentice and apply for the incentive payments. We currently have many high calibre candidates on our books who are actively looking for an apprenticeship and, in many cases, will be able to provide you with appropriate CVs straight away. Please get in touch with us to find out how we can help you, by calling us on 01614808171 or emailing us at email@example.com.