The Apprenticeship Levy

27 Oct 17 by esphr

The Government’s introduction of the Apprenticeship Levy in England has received much publicity. Thousands more apprenticeships are expected to be created with qualifications designed to make this a qualification route of choice for many more people.

What is less known is that the Government has, at the same time, carried out a major shakeup of the entire apprenticeship system.

Here are some lesser-known aspects of the new regime that, as an employer, it could be worth your while being aware of:

If you are a non-levied business, apprenticeship training routes are open to you as well.

It might be thought that training providers will be focussing their marketing and resources on larger levied employers. There is, however, a parallel funding scheme covering apprentices receiving on the job training with non-levied employers. Small employers will have access to funds through an Education and Skills Funding Agency (“ESFA”) programme that is presently in procurement. Training Providers are busy bidding to secure budgets which will become available to meet the costs of off the job training (for example in FE Colleges).

Once the outcome of the ESFA procurement is announced businesses will need to work with successful training providers who are in a position to support the kind of apprenticeship you wish to offer. Until this funding is in place, existing arrangements should continue as normal.

Don’t overlook financial incentives that are available for particular categories of apprentices.

The Government is determined to encourage more opportunities to become available for school leavers to move straight into a meaningful career without the need to spend time at College or University. A cash incentive of £1,000 is payable to each of the Training Provider and the Employer for every apprentice recruited in the 16-18 age category. NIC contributions are also waived.

It is important, of course, that all young people have this opportunity. To this end, financial incentives also exist for training providers and employers who bring a young person previously in care or with an Education, Health and Care Plan into an apprenticeship.

If you have fewer than 50 employees it gets even better.

As a general rule, non-levied employers committing to apprenticeships are expected to meet 10% of the training costs. For smaller employers the liability to make that contribution is waived. The employer just meets the payroll and other benefit costs involved.

You are free to recruit existing employees into apprenticeships.

Apprenticeships are designed to benefit both employer and apprentice. The system can be used effectively where you see a highly regarded employee in a job that will unlock full potential for your business. There are some straightforward eligibility rules to be satisfied but that individual could become your first or next apprentice.

How can we help?

Through our strategic partnership with Ward Hadaway law firm, access is available to a dedicated team covering all aspects of apprenticeships including contracting and regulatory requirements.

For further information, please contact us and we will ensure we put you in contact with a specialist from Ward Hadaway immediately. Call 0333 006 2929 or email us at


This article has been drafted on esphr’s behalf by Ward Hadaway Law Firm. Ward Hadaway Law Firm are one of esphr’s strategic legal advisory partners and provide certain services to our customers through a range of different Legal and HR support services offered by ourselves to the Corporate market. The content of this article does not constitute legal advice and it should not be relied upon. Specific legal advice may be required to address your specific circumstance.