Taking on an apprentice as a small business owner: a 4-step guide

Whether you’re interested in sharing your knowledge with someone new to your trade or are just looking for a financially competitive way to bring on an extra pair of hands, taking on an apprentice could be a great opportunity to grow your business.

It’s worth noting that the government is introducing apprenticeship reforms to tackle UK-wide skills shortages. 

The first report from Skills England, the government’s new skills and training body, has found that today’s employers are investing the lowest amount in training since records began in 2011. 

There is definitely a need for more skilled workers too – 2.5 million roles across the UK are in critical demand, with 90 per cent of these needing people with specific training or education. 

In response to these sorts of trends, the government is changing the way training for young people is funded to give businesses more flexibility. They’re doing this by launching a new growth and skills levy to replace the apprenticeship levy – we’ll discuss this in more detail later in this guide.

Plus, keep reading to learn more about how to hire an apprentice, how much it could cost you, and hear from two people who’ve been through the whole process.

• what is an apprenticeship?
• how does an apprenticeship work?
• why hire an apprentice? 
• how to take on an apprentice 
• how much does an apprentice cost?
• how to choose an apprentice

What is an apprenticeship?

An apprenticeship is a work-based training programme. It generally gives people interested in entering a certain trade or industry the chance to learn on the job and develop practical experience. It includes classroom learning alongside on-the-job training.

While apprenticeships are generally associated with younger people, you can hire an apprentice of any age. It’s a valuable way for someone to upskill or change their career.

Apprenticeships often end in a certification or qualification in a certain industry, allowing people to gain jobs in the areas that interest them. Many businesses employ their apprentices directly after they complete their training, as they’re already well-trained specifically for that business.

How does an apprenticeship work?

If you’re a small business owner looking to take on an apprentice, here’s what you need to know. Any apprentice you hire must be over the age of sixteen and not be in full-time education.

Apprentices are considered true employees of the business. If you’re taking on an apprentice for your small business, they’ll:

• receive a salary (at least the minimum wage)
• be entitled to annual leave and sick pay
• have dedicated time to study during working hours (this could be with a college or training provider)
• train with you from one year minimum up to five years

Why hire an apprentice?

If you’re interested in taking on an apprentice in your small business, you may be wondering what’s in it for you and your team? Serena Vano started at Simply Business as an apprentice and is a huge champion for apprenticeships everywhere.

“If you’re questioning getting an apprentice: go for it – it’s a really incredible journey. You’re able to help someone learn and upskill through on-the-job experience – but you’re also able to watch them grow in their confidence, see them recognise their own growth, and have those eureka moments when they realise how much they’ve learnt.

“Your employees that are supporting the apprentices are able to grow through the experience too. By mentoring an apprentice and acting as a close support system, your team can grow both professionally and personally.

“Apprenticeships also provide important opportunities for those who may be from underrepresented groups. By offering an apprenticeship, you’re opening a door to an industry that may not have been available through other routes.”

How to take on an apprentice

Employing an apprentice can be a valuable decision and it mutually benefits both you and your apprentice. As a small business owner, you’ll have a wealth of knowledge to share with your apprentice – helping to shape the next generation of your chosen industry.

But how do you hire an apprentice?

1. Choose a relevant apprenticeship training course

The government website lists all the current apprenticeship training courses you can choose from. It’s at this stage you can see the required qualification levels and how much funding you’re entitled to, so you can choose a course that’s a good fit for both your business and your apprentice.

2. Choose the right training provider

As 20 per cent of your apprentice’s time needs to be spent learning ‘off-the-job’, it’s important that you choose the right training provider. This will be the organisation responsible for teaching this part of the course.

Nowadays, many training providers offer online learning, so you’re no longer limited by choosing training providers close to the workplace.

Serena Vano, TechOps Lead at Simply Business, understands the importance of finding the right training provider. When recruiting apprentices, she believes it’s important to not only focus on the course content.

“Partnering with a good provider is key to making sure everyone gets the most out of the apprenticeship experience. It’s important that they’re the right fit for you and your business. Do they care for the same values that you do as a company? If things like diversity and social impact matter to your business, find a training provider that feels the same.”

3. Find your apprentice

If you’re based in England, you can find an apprentice by creating an apprenticeship services account. This is where you’ll advertise your available roles, manage payments to training providers, and manage your funding.

For those based outside of England, you can use these links to find out more information on hiring an apprentice in Scotland, Wales, and Northern Ireland.

4. Complete your training plan

Once you find an apprentice, you’ll need to create a training plan for them. This will then have to be signed by yourself, your apprentice, and your chosen training provider.

This makes sure that you get the most out of working with your apprentice, and your apprentice gets the most out of learning under you. It’s important that your apprentice:

• is truly learning, working with experienced staff who can share their knowledge
• learns industry-specific skills that will help them grow their career
• gets all the benefits a traditional employee would get at your business

How much does an apprentice cost?

So, if you’re paying them the minimum wage (at least), how much will hiring an apprentice cost you? While the specific costs of hiring an apprentice will depend on your industry and location, the good news is that you may be entitled to additional funding when taking on an apprentice.

Apprenticeship funding: what is the apprenticeship levy?

You can get funding from the government when you hire an apprentice. This funding will go towards helping with training and assessment. How much funding you get will depend on if you pay the apprenticeship levy.

The apprenticeship levy is how businesses can continue to offer apprenticeships with the help of government funding. The levy is a tax paid by businesses that have a payroll of more than £3 million and is charged at 0.5 per cent of your business’s total payroll.

After it’s paid as tax, this money is then stored in a fund which is put back into apprenticeship programmes through government funding.

However, if you’re a small business then you may not meet this £3 million threshold. This means that you’ll only have to pay five per cent of the cost of training and assessing your apprentice.

The other 95 per cent will be paid through government funding and will go directly to the training provider.

On top of this, you may also find your business making a profit because of your apprentice. A recent study showed that an employer’s estimated yearly gain for hiring an apprentice is between £2,500 and £18,000 on average.

Apprenticeship reforms: what is the growth and skills levy? 

The government is introducing the growth and skills levy to apparently give businesses more flexibility when training young people. It will replace the current apprenticeship levy. 

The aim is to “rebalance” spending on apprenticeships by shortening the length of programmes (currently at a minimum of 12 months) and stopping levy funding for level 7 schemes (equivalent to a master’s degree and often accessed by older or already well qualified employees).

Instead, the government is expected to introduce new paid ‘foundation’ apprenticeships. These will offer training to young people who aren’t ready to start apprenticeships at level two or three. 

We’ll hear more about what else the new levy will include over time.

How to choose an apprentice

When it comes to choosing an apprentice, there are certain skills you should look out for. Ata Ata, our Senior eCRM Manager, has worked with multiple apprentices in his team – even hiring two of them after their training ended.

On how to choose the right apprentice, Ata says: “Look to hire someone that’s curious, keen to learn, and wants to progress their career. You want to see someone who’s highly engaged in the work and really wants the opportunity to put what they’re learning into practice.

“It’s a really rewarding process to see them grow and develop and I’m still in touch with my previous apprentices today.”

Types of apprenticeships you could offer

While the government website lists all available apprenticeship courses you can choose from, here are a couple of ways apprenticeships could work in your small business.

Plumbing apprenticeship

If you run a small plumbing business, an apprentice could be a valuable addition to your team. A typical plumbing apprenticeship can take up to four years, so you’ll have a dedicated team member to share your skills with for a significant amount of time.

Mechanic apprenticeship

Self-employed mechanics can bring an apprentice into their business no matter their specialism. There are training programmes available for everything from electro-mechanical engineering to lift and escalator maintenance. The length of the training course will depend on the level of qualification offered.

Dental nurse apprenticeship

If you run your own private dental practice, you can have an apprentice join your team to train as a dental nurse. Training programmes for dental nurse apprentices are typically around 18 months in length and can lead to further training.

Tattoo apprenticeship

Unlike other trades mentioned, tattoo apprentices often apply directly to tattoo studios to work with artists who inspire them. If you own your own tattoo studio and someone approaches you for an apprenticeship, you can have them help out in the studio whilst you offer advice on tattooing – and even the potential to practise.

Software engineer apprenticeship

You don’t need a university degree to be a software engineer – and perhaps as a self-employed software engineer you’re ready to share what you’ve learned. There are many different levels of qualifications available from software engineering training programmes, with most lasting from approximately 18 to 24 months.

Have you hired an apprentice for your small business? Let us know how the process went in the comments below.

More guides on employing staff in your small business

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• How to write a reference for an employee
• A guide to paying PAYE for small businesses
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