Why you can’t afford (not) to develop your team

By Rachael Randall

On 12th April 2020

“Many employers don’t even realise that they’re ALREADY paying to train their people”

When it comes to running your own business, finding the right people who share your passion and vision is one of the hardest parts of the job – but the truth is, it’s the only way to grow in the long run. 

There’s an old quote from Sir Richard Branson:

“Train people well enough so they can leave, treat them well enough so they don’t want to.”

Wise words indeed – and if there’s one thing I’ve learned over the past twenty years, as we’ve grown a small core team to a family of over 60, it’s that people really make a business thrive. 

Now, maybe I’m a bit biased, but I really believe that upskilling your team is essential. Whether it’s preparing someone for a more senior role, growing someone’s knowledge so that they can take their first step into Management, or taking on someone straight from school and giving them that first experience of the working world, growing and developing your team will always pay dividends. 

But the reality is, all-too-often, when budgets get tight, one of the first areas to be cut is training. It’s never made sense to me, but it’s something I’ve seen time and time again – so it’s never surprising when the default reaction from an employer is “we can’t afford to train people at the moment”. 

Many employers don’t even realise that they’re ALREADY paying to train their people by paying into an Apprenticeship levy – which they can use to develop their workforce… and if they’re not yet paying into the levy, they’re also not aware that the Government will pay 95% of the cost 

 

Interested? Read more below in my quick guide to the levy….  

  1. Who has to pay a levy? 

If you are an employer with an annual pay bill of £3 million, you are required to pay into your Apprenticeship levy ‘pot’ through the HMRC PAYE process.

  1. What can I use it for? 

You can use funds in your account to pay for Apprenticeship training and assessment for apprentices that work at least 50% of the time in England. 

You can’t use funds in your account to pay for other costs associated with your apprentices (such as wages, statutory licences to practise, travel and subsidiary costs, work placement programmes or the setting up of an Apprenticeship programme). 

  1. What if I don’t pay into the levy? 

If your annual pay bill is less than £3 million, you can still access funding to provide Apprenticeships for your employees. 

The ‘co-investment’ route means that the Government will pay 95% of the cost, with the Employer paying 5%. For example, a Level 3 Team Leader/Supervisor Apprenticeship costing £3500 would only cost you £225. 

  1. Will I have to pay my staff a lower salary if they start an Apprenticeship? 

It’s a common misconception that apprentices earn a low salary. For existing staff, there is no need to make any changes to their salary – although you may want to consider a pay review on completion of an Apprenticeship. 

However, you must pay the apprentice at least the minimum working wage for Apprenticeships. The current minimum wage rate for an apprentice is £3.90 per hour. 

This rate applies to apprentices under 19 and those aged 19 or over who are in their first year. 

You must pay the apprentice at least the minimum wage rate for their age if aged 19 or over and having completed their first year.

  1. Won’t an Apprenticeship mean that my employee needs time off for courses? 

Part of your commitment as an employer is to ensure that you give your employee paid time to undertake training relevant to their Apprenticeship. This is called ‘off-the-job’ training. The Government requires all apprentices to undertake training for at least 20% of their working week throughout the duration of their Apprenticeship. In reality, this equates to 1 day per week. 

However, ‘off-the-job’ doesn’t necessarily mean ‘day release’. Our team will work with you to design a training programme that suits your business needs whilst ensuring that your apprentice can gain valuable training time to develop new skills and broaden their knowledge.

 

Talk to us today 

With 20 years’ experience, friendly and knowledgeable advice and rated ‘GOOD’ by OFSTED, you can rely on us. Give us a call today on 01983 533926 or get in touch using the Contact us button below and one of the team will be happy to help.

We know our stuff

With 20 years’ experience, and a team of industry professionals, we create impactful learning programmes that deliver results. Rated ‘GOOD’ by Ofsted, and with thousands of success stories under our belts, you can rely on us.

Contact Us

Monday–Thursday: 9:00am–5:00pm
Friday: 9:00am–4:30pm

Isle of Wight
01983 533926

Portsmouth
02392 374752

or at any time via Social Media