When firms start looking at apprenticeships as a source of cheap labour, they risk devaluing the programme, and their own reputations

Ronnie Tong

Employing apprentices offers many benefits for construction firms, but it’s a responsibility that should not be taken lightly. As highlighted by the actions of retail giant Next last year, which had to suspend its government-funded apprenticeship scheme after a damning Ofsted report, the unfair treatment of apprentices will result in widespread criticism and reputational damage for companies. To avoid this risk, employers should consider the following before implementing an apprenticeship scheme:

  • Education and training in the profession is an essential part of any apprenticeship. Employers have come under fire when it becomes apparent that this is not what is on offer. Rebranding low-paid work as apprenticeships and failing to provide on-the-job training and development opportunities is likely to attract criticism. Employers need to be mindful that training is the primary purpose of any apprenticeship and working for the employer is secondary.
  • Traditionally apprenticeships are targeted at individuals aged between 16 to 24 because government funding is aimed at this age group. Placing an upper age limit when recruiting apprentices can cause difficulties and it is possible that such recruitment campaigns may be considered discriminatory against older applicants under the Equality Act 2010. There is a defence to this type of age discrimination if employers can objectively justify the age limit and demonstrate that it is a proportionate means of achieving a legitimate aim.
  • It is of vital importance that employers have the correct contractual arrangements in place for an apprentice. There are two types of contracts:
    1. 1) A “traditional” contract of apprenticeship is governed by common law. It is often more difficult to dismiss an apprentice working under a traditional contract of apprenticeship than an ordinary employee.
    2. 2) An apprenticeship agreement governed by the Apprenticeships, Skills, Children and Learning Act 2009 (ASCLA 2009). This type of contract is similar to a normal contract of service an ordinary employee would have. Apprentices working under these types of agreements can therefore be dismissed in the same way as ordinary employees.
    In order for an apprentice agreement to be covered by ASCLA 2009, it must meet certain conditions and failure to incorporate these in the agreement may mean that the employer has inadvertently created a traditional contract of apprenticeship.
  • The National Minimum Wage Regulations set out the minimum hourly rate for an apprentice. There are different rates depending on whether the apprentice is under 19 or in the first year of their apprenticeship.
  • The Working Time Regulations will apply to apprentices and therefore employers should be mindful of providing the apprentice sufficient rest breaks and that the number of hours they are required to work do not breach legislation.
  • Given the typical age group of apprentices, it is not uncommon for them to be bullied by older workers. What may be considered by some as office banter may be interpreted by others as something more sinister.
    Employers have an implied duty of trust and confidence to all staff and must take steps to ensure that the work environment is free from bullying and harassment. Apprentices should be made aware of grievance procedures and who to contact if they wish to raise an issue. Most importantly, employers must take such allegations seriously and ensure that they are fully investigated.
  • Employers must also consider any relevant apprenticeship standards that have been drawn up and adopt where appropriate. The standards are very prescriptive, designed to meet the needs of employers, the sector and the economy more widely.
    Apprentices are also entitled to terms of employment consistent with those offered to other employees of similar status and length of service. Employers cannot offer less favourable terms and conditions to apprentices save for pay and any service-related benefits.
  • The construction industry is already familiar with the Construction Industry Training Board levy, but the introduction of the Apprenticeship Levy in April 2017 is likely to result in an increase in apprenticeships. Applicable to employers in all sectors, the Apprenticeship Levy will be payable from April 2017 at a rate of 0.5% of an employer’s pay bill if it is in excess of £3m. Employers will receive an allowance of £15,000 to offset against their levy payment.
    Businesses seeking to take advantage of the Apprentice Levy must ensure that they offer a structured training programme which, at its heart, is aimed at providing training and development for individuals. It is essential that firms view apprentices as a valuable investment in the future of their business – and not as cheap labour. Giving them the chance to train and add value to the organisation and ensuring that legal processes are followed will avoid any potential pitfalls and adverse publicity.

Ronnie Tong is a partner at Devonshires Solicitors