There have been lots of changes to the apprenticeship set up, so we asked PQ magazine editor Graham Hambly how small practices can go about signing up one
All the recent talk of apprenticeships and the government levy has meant many smaller firms have become confused about how they can sign up an apprentice. The main thrust of the recent government changes was to give employers ownership of apprenticeship training. So, in theory, if you want to deliver your own apprenticeship training you can (find out more at: www.gov.uk/government/ publications/apprenticeships-become-a-training-provider).
I would suggest that a small practice would be over-complicating their lives by going down this route. Far better is to go to an approved training provider who has a direct non-levy apprenticeship contract with an Education and Skills Funding Agency. Most of the good private accountancy tuition companies have one. We are talking Kaplan, BPP and HTFT here. Many local colleges also run very good schemes, too.
One of the big changes is that there are no longer one-year apprenticeships anymore.
You the employer
As an apprentice employer you will be responsible for paying your apprentice’s wages and giving them their contract of employment. They must be given at least 20 days’ paid holiday per year, plus bank holidays. The www.gov.uk site has a holiday calculator so you can check your apprentice’s entitlement.
Perhaps more importantly you must pay apprentices at least the national minimum wage rate. So, what are those rates? Well, from April 2018 they are: Apprentice £3.70; Under 18 £4.20; 18-20 £5.90; 21-24 £7.38; 25 and over £7.83.
Apprentices are entitled to the apprenticeship rate if they are under 19 or aged 19 or over and in the first year of their apprenticeship. So, for example, an apprentice aged 22 in the first year of their apprenticeship is entitled to a minimum hourly rate of £3.50 (current rate until April 2018).
Apprentices are then entitled to the minimum wage for their age if they are aged 19 or over and have completed the first year of their apprenticeship. In the case of an apprentice aged 22, who has completed the first year of their apprenticeship, they become entitled to a minimum hourly wage of £7.05 (new April 2018 rate is £7.38).
If you are a small employer (fewer than 50 employees) you will pay (0%) towards training an apprentice who is under 18 or 19-24 with an Education Health Care (EHC) plan, providing the cost of their training is within the maximum funding band. It is 10% for other apprenticeships.
There is also £1,000 fund available to any employer taking on a 16-18 year old apprentice, or a 19-24 year old with an EHC plan. From 2018, you can access funding through a new digital account, to pay for the cost of training. To access the funds in your new digital account you will need to register online with the Skills Funding Agency at www.gov.uk/guidance/manage-apprenticeship-funds
In accountancy there is up to £9,000 worth of funding up for grabs for the first two levels (see below). But you (or your firm) does not receive this money – the training provider does! The apprentice of course gets a great qualification, too. In the worse case scenario you pay 10% of the training fees.
The three levels
There are currently three standards relating to the accountancy sector:
1) Assistant Accountant: Level 3; 15-18 months; £9,000 funding band
Typical qualification: AAT Advanced Diploma in Accounting
Role profile: An assistant accountant provides support to internal and external customers and will work predominately either as an assistant accountant with a practice or alternatively within the finance function of an organisation. Part of their role will involve assisting in the day-to-day financial activities such as data entry to moth end management accountant/or year-end financial statements.
In addition, they may find themselves involved in regulatory financial requirements such as the completion of VAT returns or assisting in the preparation of tax computations.
2) Professional Accounting/Tax Technician: Level 4; 18-21 months; £9,000 funding band
Typical qualification: AAT Professional Diploma in Accounting (Level 4), or ACCA Diploma in Accounting and Business, or ICAEW Certificate in Finance & Business
3)Professional Accountant: Level 7; 18-36 months; £21,000 Funding band
Typical qualification: ACCA and ICAEW professional qualification
Off the job training
Your apprentice must receive 20% off the job training. This is learning that is undertaken outside the normal working environment. This can include training delivered at the apprentice’s normal place of work, but must not be delivered as part of their normal working duties.
It must also be directly relevant to the apprenticeship framework or standard. This means it can take the form of simulation exercises, online learning or lecturers. It can also include shadowing, mentoring and industry visits or even time writing an assessment/assignment. But your training provider will be there to hold your hand with this.
15 month Apprenticeship programme
35 hour week (seven hour day)
25 days holiday plus eight bank holidays
285 working days = 195 working hours over 15 months
20% Off The Job Training = 399 hours (57days) over 15 months
For more information and advice you can contact HTFT’s James Taylor on email@example.com and BPP at firstname.lastname@example.org or call 03301 349 291.
• Graham Hambly is the Editor of PQ magazine, the UK’s leading publication for trainee accountants. Email email@example.com
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