New government investment in apprenticeships and workplace training could prompt more employers to review how these programmes fit into their workforce plans.

The government’s September 2026 announcement included £100 million over two years to expand local apprenticeship services and £15 million a year to restore the Union Learning Fund in England. This builds on changes to apprenticeship training funding introduced in August.

For HR leaders, these developments provide a timely opportunity to review the legal arrangements underpinning both new and existing apprenticeships. The type of agreement used, the commitments made around training and the provisions for ending employment can materially affect an employer’s options if difficulties arise.

This article focuses on apprenticeships in England. Different frameworks apply elsewhere in the UK.

What does the new funding mean for employers?

For eligible apprenticeship starts from 1 August 2026, government funding covers training and assessment costs up to the relevant funding band maximum for apprentices aged 16 to 24 at non-levy-paying employers. This support also applies where levy-paying employers have insufficient funds.

From October 2026, eligible non-levy-paying employers can also receive a £2,000 hiring payment for recruiting new apprentices aged 16 to 24, subject to the scheme’s conditions.

Employers should confirm the applicable eligibility criteria and funding conditions with their training provider. Funding approval does not, in itself, establish that the employment documentation is legally appropriate or remove the employer’s obligations towards the apprentice.

Before expanding apprenticeship recruitment, HR teams should check that their contractual arrangements reflect the programme being offered and the obligations the organisation is taking on.

Why the type of apprenticeship agreement matters

One of the most significant legal considerations is the distinction between an approved English apprenticeship agreement and a common law contract of apprenticeship.

An approved English apprenticeship agreement that meets the statutory requirements is treated as a contract of service. Broadly, this allows employment issues to be managed within the usual employment law framework, subject to the contractual terms and applicable statutory protections.

A common law contract of apprenticeship has a different legal character. Its central purpose is to provide training, and the apprentice can have enhanced protection against early termination.

Where documentation fails to meet the statutory requirements, there is a risk that the arrangement could be interpreted as a common law apprenticeship. Simply describing a document as an “apprenticeship agreement” does not settle its legal status.

For employers, this distinction can become particularly important when considering dismissal, redundancy or changes that affect the organisation’s ability to deliver the promised training.

Review the documents together

Employers in England must sign an apprenticeship agreement with the apprentice and a training plan with the apprentice and training provider. The training plan must cover the planned training, the parties’ responsibilities and arrangements for resolving queries or complaints. A valid apprenticeship agreement is also required for funding.

HR teams should review these documents alongside the employment contract and relevant policies, checking:

• Status and statutory requirements: Does the agreement meet the requirements for the intended apprenticeship arrangement?

• Duration: Are the employment term, practical training period and expected completion arrangements clearly distinguished and consistent?

• Training commitments: Is responsibility for providing training, releasing the apprentice and monitoring progress clear?

• Pay and hours: Do the terms accurately reflect paid working and training time?

• Termination: Are any provisions for ending employment early appropriate to the arrangement?

• Provider arrangements: What happens if training is interrupted, the provider changes or the apprentice needs additional time?

Using a training provider’s standard documents should form part of this review. Employers still need to understand the commitments those documents create and how they interact with their own terms.

Pay and training time carry legal obligations

Apprentices are entitled to statutory employment protections, including paid holiday and the applicable minimum wage.

The apprentice minimum wage rate does not apply throughout every apprenticeship. Entitlement depends on the apprentice’s age and whether they have completed their first year. Employers should ensure payroll processes identify when a higher age-related rate becomes payable.

Apprentices must also be paid for time spent undertaking apprenticeship training or study and given time during their working week to complete the required training.

HR teams should check that contractual terms, working arrangements and payroll treatment align in practice. Operational pressure should not result in training being routinely displaced or treated as unpaid additional work.

Managing performance requires attention to the training commitment

Employers can set standards for attendance, conduct and performance. However, when concerns arise, the apprentice’s development stage and the training promised should inform the response.

Before moving to formal action, consider whether expectations were clear, the required training was delivered and the apprentice had an appropriate opportunity to develop the relevant skills. Keep records of reviews, support offered and discussions with the training provider.

Where disability may be relevant, reasonable adjustment obligations also need to be considered. This may require coordination between the employer and provider so that workplace and training support are consistent.

A probation clause should not be treated as providing an unrestricted right to terminate. Its effect must be assessed alongside the apprenticeship’s legal status, the wider contractual terms and applicable employment rights.

Ending an apprenticeship early can create additional exposure

Before considering dismissal or redundancy, establish which type of apprenticeship arrangement is in place.

For an apprentice employed under an approved English apprenticeship agreement, the contractual provisions and usual employment law considerations remain important. Employers should check whether the agreement permits early termination and follow an appropriate procedure.

The position can be substantially more restrictive under a common law contract of apprenticeship. Early termination may expose the employer to a breach of contract claim covering the remaining contractual period and losses associated with being deprived of training and future career opportunities.

Poor performance or a downturn in work should not be assumed to justify terminating a common law apprenticeship. The circumstances in which it can lawfully be brought to an early end are limited.

Review the agreement and take advice before communicating a decision. The potential exposure can extend beyond an ordinary unfair dismissal claim.

Plan for completion as well as recruitment

The documents should make clear what is expected to happen when the apprenticeship ends. HR teams should also monitor whether the anticipated training and completion dates remain realistic.

If employment is fixed term, avoid treating the end date as a purely administrative event. Non-renewal of a fixed-term employment contract constitutes a dismissal, and the employer should assess the applicable rights, reason and process before employment ends.

Early planning allows time to address delayed completion, discuss any continuing role and ensure communications are consistent with the contractual position.