An SME guide to taking on an apprentice

POSTED: 11th August 2015
IN: Guides

With a number of UK sectors facing significant skills shortages, many employers are beginning to embrace the opportunities apprenticeships create to develop fresh talent within the business.

However, there are a number of requirements companies must meet before hiring an apprentice to ensure they are providing a high-quality learning environment.




Sustainable funding

For large corporations with the necessary financial backing and resources, providing apprenticeships may be relatively straightforward to implement. However, for much smaller companies with limited time and funds, committing to an apprenticeship may be a bigger challenge.

Although the minimum wage for apprentices currently stands at £2.73 an hour, employers can choose to pay more than this if they wish. The amount paid often depends on the sector, region and apprenticeship level. Not only must apprentices be paid no less than the minimum wage during their placement, but if part of their apprenticeship involves study sessions or classes at a college or training provider, they must be paid for this time too.

While some employers may see the hiring of apprentices as a way of growing the workforce on a budget, it’s vital that businesses take training costs into account and provide apprentices with a valuable learning experience. This can of course, have a significant cost attached to it.

Furthermore, since employers have a contractual agreement with an apprentice, they cannot make an apprentice redundant in the event that, for example, the business cannot fund the scheme as they are experiencing cash flow issues. As a result, forward planning by the business is required to ensure that the scheme is sustainable.

Accessing suitable grants

There are grants available to employers that choose to take on an apprentice, providing they meet set criteria. Usually, a company will be entitled to a £1,500 grant if it has less than 50 employees and the apprentice is aged between 16 and 24. Eligible businesses can claim support for up to five apprentices.

Employers may also be entitled to funding to cover the cost of an apprentice’s qualification. The amount of money they receive will vary on the candidate’s age.

Providing apprentices with a mentor

Mentoring plays a vital part of any apprenticeship scheme and as group training manager for Gelder Group, Mike Johnson explains: “To look after an apprentice you need to have a dedicated person to be their mentor. And over the last three or four years, most SMEs haven’t had the spare people to do that.” There are also other practicalities that must be taken into account, such as the creation of apprenticeship agreements that cover the course length, levels of training, and target qualifications.

“It’s not the risk factor that puts many SMEs off, it’s more the time factor,” Mike Johnson adds.

For those faced with stretched resources, some employers may be relieved to learn that this mentor doesn’t have to be an employee. Companies taking on an apprentice could seek the support of a training provider that will be available to offer hands on support.

“A working relationship with a proactive training provider is key to the success of the apprenticeships,” says HR partner Deborah Atkins. “We often turn to our training provider for advice and guidance and they are always on hand to support us and our apprentices.”

The benefits of apprenticeships for SMEs

In 2012, the Department for Business, Innovation and Skills commissioned Holts Group CEO Jason Holt to lead an enquiry into making apprenticeships more accessible for SMEs, leading to important changes in the way apprenticeships are managed.

Before these changes, just 10 per cent of SMEs offered apprenticeships, but in a 2014 study, 20 per cent said they planned to take one or more apprentices on within the next 12 months.

“I think the big picture we are seeing is a cultural shift in the mind of the small business owner,” Holt reports, adding: “When taking on a new person, they are more likely, I feel, to think of an apprenticeship than ever before. And not just employers in the manual trades but, crucially, in areas that are newer to the apprenticeship arena like IT and hospitality.”

From tackling skills shortages to enabling employers to provide an individual with the company values and goals in order to succeed, businesses that do choose to offer apprenticeship schemes can see countless benefits.

“We first looked into getting an apprentice quite late in 2012,” says Alice Prescott, Sales and Marketing Executive for IT support and consultancy firm The Oxford Knowledge Company. “We’re a small business and our main values are continual progression and learning so it makes sense to have someone on board who’s got the same kind of ambition.”

Having seen great results after recruiting two apprentices, Alice adds: “It’s really great because it means our more technically qualified consultants are freed up for more advanced projects if required, and we haven’t looked back. [Apprentices] take a lot more time: at least initially, there’s a lot more to oversee, but they’re very keen to spread their wings.”

With nearly a third of SMEs reporting to the Federation of Small Businesses (FSB) that skills shortages pose a problem for capitalising on the economic recovery, apprentices could help to resolve the situation over time.

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