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Why Should Recruitment Businesses Care that it’s the 24-month Anniversary of the Apprenticeship Levy?

The Apprenticeship Levy came into force in April 2017, meaning that 1st April 2019 marks the 24-month anniversary. This anniversary may not be a reason to celebrate for some levy payers, especially levy paying recruitment businesses.

Why?

Recruiters, especially those with a temporary workforce, have a high pay bill but a smaller number of permanent employees who could qualify for apprenticeship training. Therefore, its common to see apprenticeship levy funds underutilised.

Part of the apprenticeship levy legislation means than unused funds are cleared from an employer’s apprenticeship funding account 24 months after they have been added to the account. Therefore this 24-month anniversary marks the start of the clear down of these funds.

So, in order to prevent the waste of the levy contributions what can recruitment agencies do?

1 – Recruit an apprentice

Sorry to state the obvious, but that’s kind of the point of the levy! Think about future internal recruitment plans and consider opportunities for recruiting apprentices instead. Apprentices can free up time for more experienced staff adding real value to the business. In an economy with such low unemployment rates (now below 4%) it can be a great long-term strategy for feeding talent into hard to fill roles. Traditionally apprenticeships were considered for roles such as construction and engineering. Nowadays apprenticeships cover a host of roles from digital marketing to management to HR.

2 – Upskill existing employees

Apprenticeships are not just for new recruits. In fact, your levy funds can be used for the training and development of any of your employees and is a great way to improve employee engagement and productivity. There is no restriction on age or previous qualifications as long as they are not at a more advanced level in the same field. For example, an employee with a masters in sociology could still do an apprenticeship in HR.

Apprenticeship training could be used when an employee has had a promotion, change of responsibility or even part of their ongoing development. Recruitment agencies can access sector specific apprenticeships including recruitment resourcer (level 2 equivalent of 5 GCSEs) and recruitment consultant (level 3 equivalent to 2 A levels) and recruitment supervisor (also level 3) as well as others that would support other business operations. A list of standards available can be found here https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/663656/ticklist_30_11_17.pdf

3 – Share your levy funds

There are strict rules on sharing your levy funds, but these rules are opening up from April 2019. The new rules will allow levy payers to share up to 25% of their funds. This can be shared to multiple employers and the levy payer can choose any other employer (Levy payer or not) to share the funds. Check out our blog to find out more.

So in summary, lets celebrate the apprenticeship levy’s birthday by spending its money! (You don’t need to tell me twice!)

If you’ve found some innovative ways of utilising your levy, we’d love to hear about them in the comments below. Let’s spread the word.

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