Since Chancellor Rishi Sunak announced the kickstart scheme as part of his Plan for Jobs, there has been some confusion on what the difference is between the new scheme and apprenticeships.
The main thing to think about is do you want to employ someone for only six months, if the answer is yes, then the kickstart scheme is slightly more financially beneficial for most age groups, though not all, but the difference isn’t significant and the hidden cost of training them to be productive would be lost when they leave.
If you want to employ someone for 12 months or longer, the apprenticeship scheme is more financially beneficial, and you get tutor support when the apprentice is in the workplace.
The main points on both schemes are:
The Kickstart Scheme has been introduced to provide financial incentives to employers to employ young people. Key points about the scheme are:
- The job must be a new position – not displacing or replacing one that existed previously
- The job must be ‘high quality’ (although there is no guidance as yet as to how this will be measured)
- The proposed employee must be aged 16-24 years old when they start
- The proposed employee must be in receipt of Universal Credit
- The proposed employee must be considered by the Jobcentre as being at risk of long-term unemployment (though we still await guidance on how this will be determined)
- Employers will be expected to provide training (although not through the apprenticeship scheme) and/or job search support to improve the employee’s long-term job prospects
- Funding will only cover the relevant National Minimum Wage rate for the employee. If the employer pays higher than the NMW, the difference remains a direct cost to the employer
- Funding is for 25 hours per week. If the employee works more than 25 hours per week this also remains an additional direct cost to the employer
- Funding will cover six months of employment
- Funding will cover National Insurance and Mandatory pension contributions (‘on-costs’)
Apprenticeships are a fantastic opportunity to home-grow your talent and research has shown that apprentices improve productivity, staff morale and customer satisfaction.
- Commitment to paying employers to create new apprenticeships to January 2021
- Bonus scheme to run from August 2020 to January 2021
- Continued payment of the £1,000 Employer Incentive Payment for employers hiring 16 to 18-year olds
- NEW incentive of £2,000 for employers who hire apprentices aged 16 to 24 years. You can apply for the payment until 30th April 2021
- NEW incentive of £1,500 for employers who hire apprentices aged 25 and older. You can apply for the payment until 30th April 2021
- Apprenticeship programmes run for a minimum of 12 months
National Living Wage and the National Minimum Wage
|National Living Wage||Age 21to 22||Age 18 to 20||Age 16 to 17||Apprentice*|
|April 2020 (Current rate)||£8.72||£8.20||£6.45||£4.55||£4.15|
|From April 2021||£8.91||£8.36||£6.56||£4.62||£4.30|
*Apprentices are entitled to the apprentice rate if they are either aged under 19 or aged 19 or over and in the first year of their apprenticeship.
If you would like to find out more, please feel free to contact Sue on:
Mobile phone – 07486 073844
Email – email@example.com
Or arrange to have chat https://calendly.com/spottertalent/discovery-call