The apprenticeship Levy: Are you ready?

With the launch of the Apprenticeship Levy just under a month away, now is the time for employers to check they have everything in place before the much talked about Levy goes ‘live’ on April 6th.

Apprenticeship Levy - MyKindaFuture

The Levy will apply to all large organisations with an annual payroll of over £3million per annum, regardless of whether they already employ Apprentices or not. It will be payable by employers in the UK at the rate of 0.5% of the payroll cost through PAYE alongside Income Tax and National Insurance.

The Levy aims to give employers more control over shaping the apprenticeship training itself and the quality of delivery, to build a more highly skilled workforce for the future and increase UK competitiveness.

Alongside the Levy will be the launch of the Institute for Apprenticeships, an employer-led body which will regulate and maintain the quality of apprenticeships and funding. The Chair, Antony Jenkins, and eight Board members have now been formally announced by the Government, with overall responsibility for ensuring employees are getting the skills they need from the apprenticeship system.

A key step employers can take right now, is to register and create an apprenticeship account through the Digital Apprenticeship Service (DAS), an online digital system which has been set-up to support the Levy. This will allow businesses to manage their apprenticeship programmes, estimate their financial spend and if they choose to recruit apprentices through their training providers.

It is worth being aware of the limitations of the Levy, as the funds can only be used for training and assessment costs for apprenticeships (starting after May 2017), not for apprentices' wages or any other type of training. In addition, employers will only be able to spend funds on courses run by approved training providers and subject to financial limits.

Employers should be looking now at which parts of their business have current skills gaps or may have them in the future, and examine where apprentices can add value and at what level according to their individual business needs. It is crucial that Apprenticeships are integrated into a company’s overall talent development plans and culture for them to be truly successful and ensure both the business and its apprentices thrive. 

In tandem with this, employers should also be looking at their current recruitment practices and strategies for attracting new talent to ensure they have the very best apprentices joining the organisation. For businesses with limited visibility with young people, (beyond promoting opportunities digitally), the Levy presents a real and exciting opportunity to create a programme which directly engages all that talent, whilst they are still in education, and considering their future career paths.

Ensuring schools, colleges and businesses have strong productive relationships is critical to building a strong talent pipeline. In Germany, for example, employers see schools and colleges as part of their supply chain. Young people need to have meaningful encounters with employers inside and outside the classroom throughout their education journey to ensure they truly understand the different career routes, such as apprenticeships, and the benefits they can offer.

MyKindaFuture offer a unique, innovative and truly holistic approach to connecting young people in education with business. As trusted partners of the largest network of schools, colleges and universities in the UK, MyKindaFuture can help employers reach the next generation of talent, more quickly and efficiently, through workshops, insight events and online challenges. They can help businesses recruit young talented people onto apprenticeship programmes whilst helping businesses to build truly sustainable relationships with schools, colleges and universities into the future.

With over 20 years experience recruiting and developing graduates and school leavers, Simon speaks to students, educators and leading employers on the topic of employability. He supports businesses across the UK & Europe to develop and implement their emerging talent strategy. In 2007 Simon was asked to take over what is now the Bright Futures Society network, this year celebrating its 40th year, which he has trebled in size and more recently introduced the Society model into secondary schools. He is also an Advisory Council member for the Association of Graduate Recruiters (AGR), and sits on the Youth Employment UK Advisory Board.

Check out MyKindaFuture's website