Employment law guide to apprenticeships

What is an apprenticeship?

Apprenticeships are work-based training programmes, which lead to nationally recognised qualifications. They enable employers to avoid skills shortages. They also allow apprentices to develop skills by working alongside experienced staff and attending day release training.

Apprenticeships are open to anyone over the age of 16. An apprenticeship will be for a fixed term (usually between one to four years) and/or until a level of qualification is reached. Generally, apprentices work for at least 30 hours a week, but weekly hours can be reduced if the length of the apprenticeship programme is extended. Apprentices are entitled to a minimum hourly wage rate. The training element of the apprenticeship is usually fully or partially government funded. The agreement will usually be in a form common to all apprentices in that trade.

On 1 April 2017, the Institute for Apprenticeships (now the Institute for Apprenticeships and Technical Education) was launched. It is a non-departmental public body and its functions include approving apprenticeship standards and assessment plans submitted by employers.

Approved English apprenticeship agreement

Since 26^th May 2015 an approved English apprenticeship either takes place under an approved English apprenticeship agreement or is an alternative English apprenticeship (see Alternative English apprenticeships). In each case, it must satisfy certain conditions.

A person will complete an approved English apprenticeship if they achieve the approved apprenticeship standard.

Approved apprenticeship standards replaced apprenticeship frameworks in respect of English apprenticeships from 26^th May 2015, subject to transitional arrangements. The following provisions apply:

• The Secretary of State must publish standards for particular sectors of work, which will either be prepared by the Secretary of State or such other person approved by the Secretary of State.
• Each standard describes the sector of work to which it relates, or if there is more than one standard for that sector, the kind of work within that sector to which it relates.
• Standards must set out the outcomes that those seeking an approved English apprenticeship are expected to achieve.
• The Secretary of State may publish a revised standard or withdraw a standard without replacing it.

The government's aim is for employers to design new standards, while the government sets a "small number of criteria" that the standards must meet. The intention is for the standards to be short and set a level of skill, knowledge and competency, against which an apprentice would be assessed. From 1^st August 2020, all new apprentices in England must start on apprenticeship standards.

An approved English apprenticeship agreement is an agreement that:

• Provides for an individual to work as an apprentice in a sector for which the Secretary of State has published an approved apprenticeship standard.
• Provides for the apprentice to receive training to assist the apprentice to achieve the approved apprenticeship standard in the work done under the agreement.
• Satisfies any other conditions specified by the Secretary of State in regulations.

An employer who wishes to vary an approved apprenticeship agreement, in such a way that it no longer satisfies one or more of the conditions for an approved English apprenticeship agreement, must give the apprentice written notice. The written notice must explain that, if the variation takes effect, the agreement will cease to be an approved English apprenticeship agreement. If an agreement is varied without giving the apprentice the requisite notice, the variation has no effect.

What should be included in an approved apprenticeship agreement?

Approved English apprenticeship agreements should contain the basic terms of employment required to be given to employees under section 1 of the Employment Rights Act 1996 (ERA 1996). They should also document:

• The start and end dates for the apprenticeship.
• The length of the practical period, which must be at least 12 months (see below).
• The standard the apprentice is working towards.
• The time to be spent on off-the-job training (see below).

Regulations require that the time spent on off-the-job training be specified. The apprentice must receive off-the-job training. "Off-the-job" training is defined as training that is not on-the-job training but which the apprentice also receives during their normal working hours "for the purpose of achieving the approved apprenticeship standard to which the agreement or arrangement relates." On-the-job training is just as it sounds: training received by the apprentice during normal working hours for the sole purpose of performing the work for which the apprentice is training. For a full-time apprentice starting their apprenticeship on or after 1 August 2022, at least 20% of a 30-hour week (even where the apprentice works more than 30 hours per week) must be spent on off-the-job training over the planned duration of the apprenticeship practical period. The minimum requirement for a part-time apprentice working less than 30 hours per week is 20% of their normal working hours over an extended duration. Overall, the minimum off-the-job training requirement for a part-time apprentice must be no less than the minimum off-the-job training requirement for a full-time apprentice. Off-the-job training should only be delivered during the practical period, during an apprentice's normal working hours, and may be delivered in a number of ways (for example, through regular day release, block release or workshops).

Approved apprenticeship agreements must specify a total practical period of at least 12 months, during which the apprentice is expected to work and receive training. The only exception to this is where the apprentice has been dismissed for redundancy with less than 12 months of their practical period left to run. In those circumstances, an employer can take on the apprentice under another approved agreement for the remainder of that period provided that the apprentice works and receives training designed to achieve the same approved standard as the standard in the old agreement.

The 2022-2023 employer guidance provides that the practical period begins on the learning start date and ends on the "learning actual end date". Off-the-job training must not take place beyond this date. Given that approved apprenticeship agreements must specify a practical period of not less than 12 months, employers should ensure that the first and last days of off-the-job training are reflected in the agreement accurately and are at least 12 months apart. The dates may not reflect a full 12 months where training is delivered by block release or there is flexibility for the apprentice to choose between day and block release.

When agreeing the practical period, the employer must also consider the apprentice's knowledge and skills, whether the work and training will be done on a full or part-time basis and the approved standard for the apprenticeship.

Note that, due to the increase in homeworking, the ESFA is reviewing the rules on time spent working in England and will update the relevant funding rules in due course.

Termination of an apprenticeship agreement

If the apprentice is employed under an approved English apprenticeship agreement, the normal principles for breach of contract and unfair dismissal claims apply. As a result, employers can effectively performance manage under-performing apprentices as they would any employee in the business. Similarly, the employer's normal absence management procedures can apply.

If the apprentice’s employment continues after the end of their apprenticeship and they move into a qualified role, they should be offered a new employment contract setting out the terms of that qualified role. The apprentice will have continuous service from the date their apprenticeship started.

Any failure to properly create an approved English apprenticeship agreement could inadvertently lead to a common law contract of apprenticeship. This is usually for a fixed term and employers have only a limited right of dismissal before the end of the term. Employers may be required to compensate an apprentice for the remainder of the term. As such it is important to ensure that the requisite conditions for an approved English apprenticeship agreement have been met if there is no intention to create a common law apprenticeship.

Flexi-job apprenticeships

The Apprenticeships (Miscellaneous Provisions) (Amendment) (England) Regulations 2022 (SI 2022/86), which came into force on 6^th April 2022, create a new type of alternative English apprenticeship, a "flexi-job" apprenticeship. Employers will only be required to give a three-month commitment, instead of the usual 12-month minimum commitment under an approved English apprenticeship agreement. This will allow flexi-job apprentices to complete discrete blocks of work with training, potentially with different employers, throughout the course of their apprenticeship. After the minimum three-month arrangement with one employer, the flexi-job apprentice can either begin a new arrangement with the same employer or move to continue their apprenticeship with a new employer to achieve one of the specified apprenticeship standards. The overall duration of the flexi-job apprenticeship practical period must not be less than 12 months.

A pilot scheme for portable flexi-job apprenticeships was launched in April 2022 for a specified number of apprenticeship standards, mainly in the creative and construction sectors where a more flexible or project-based working pattern may be needed. The pilot scheme is intended to last for 18 to 24 months, with review points mid-way through. From 7^th January 2023, the number of approved apprenticeship standards was expanded to include roles in healthcare, adult care, customer service, IT, civil engineering and construction.

The publicly available Guidance, Flexi-job Apprenticeships was published on 3 August 2021. It confirms that a flexi-job apprentice can either:

• Be employed by a flexi-job apprenticeship agency, which will employ the apprentice directly for the duration of their apprenticeship but arrange placements for the apprentice with host businesses.
• Secure multiple short-term employment contracts with businesses supporting the relevant apprenticeship requirements. Supported by their training provider, the apprentice progresses as they change employers. The guidance states that this model is often described as a portable flexi-job apprenticeship.

Recruiting an apprentice

The normal principles relating to recruitment apply to apprentices. However, in many cases, the apprentice will be young and have little or no previous work experience. In such cases, formal recruitment procedures may be inappropriate.

Organisations employing apprentices must comply with all aspects of discrimination law, particularly rules around age discrimination.

Government funding for apprentices' training is generally tiered according to age, with higher funding for younger apprentices. Funding for the Trailblazer standards was not tiered according to age. However, there are so-called "incentive payments" for recruiting a young apprentice (aged between 16 and 18). It is risky for employers to put an upper age limit on applicants for their schemes based on funding eligibility, as this could directly discriminate against older applicants, unless the employer can show that the limit is objectively justified.

Employers should also ensure that apprentices' terms of employment offered are consistent with those offered to other employees of similar status and length of service. If, as is likely, apprentices as a group are younger than the rest of the workforce, any differences in their terms and conditions may amount to indirect age discrimination unless justified in the circumstances. In theory, this concern applies to all terms and conditions, including pay. However:

• It is not unlawful age discrimination to pay an apprentice less than the adult rate for the national minimum wage.
• It is much more likely that paying apprentices above the adult minimum wage (but less than other comparable employees) can be justified based on market forces or other legitimate aims such as rewarding skills and experience.

An "apprentice rate" of the national minimum wage (NMW) was introduced in October 2010.

Workers are entitled to NMW at the apprenticeship rate if they satisfy both of the following conditions:

• They are employed under a contract of apprenticeship or apprenticeship agreement or under certain government apprenticeship schemes that are treated as contracts of apprenticeship; and
• They are in the first year of their apprenticeship or aged under 19 years.

An apprentice aged 19 or over who has been an apprentice for more than 12 months would be entitled to either the development rate or adult rate of NMW, depending on age. Participants of certain government or EU-funded schemes or employment programmes are specifically excluded from entitlement to the NMW (regulations 51 to 56, NMW Regulations).

Apprentices will benefit from all rights that workers are entitled to under the Working Time Regulations 1998 (SI 1998/1833) (WTR 1998).

Apprentices under the age of 18, but over compulsory school age, have additional rights in relation to young workers. An employer offering work to a young person, under 18, must assess the risks to such individuals before they start employment, taking into account their inexperience, lack of awareness of risks and immaturity. An employer that employs an apprentice aged between 16 and 18 should consider safeguarding measures, and it would be best practice to have a safeguarding policy.

All apprentices will be entitled to statutory maternity, paternity, adoption, shared parental pay and sick pay (subject to the usual qualifications).

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If you need guidance on any of the above matters, we are here to help.  Please do not hesitate to contact Martin Cornforth on 01636 558343, or email: martin.cornforth@chattertons.com.