Apprenticeships and hiring an apprentice

How do I hire an apprentice?

Hiring an apprentice involves a few more steps than a standard recruitment process because you must coordinate with the government and a training provider. First, you'll need to choose an apprenticeship standard or framework that fits the job role you're offering. Once you've identified the right training, you must find a training provider to deliver the formal side of the education.

You'll then need to:

• register for an apprenticeship service account on the government website

• advertise your vacancy (your training provider can often help with this)

• interview candidates and pick the best person for your team

• sign an apprenticeship agreement and a training plan with your new hire

What is an apprenticeship agreement?

In England and Wales, you must sign an apprenticeship agreement before the apprentice starts their training. You can find a template contract for England on the government website, and a template contract for Wales on the Welsh government website.

This document isn't a substitute for an Employment contract; instead, you should incorporate it into the contract. It acts as a formal record of the apprenticeship's specific details.

The agreement should:

• identify the specific skill, trade, or occupation the apprentice is learning

• state the relevant apprenticeship standard and level

• set out the start and end dates of the apprenticeship

• confirm the individual employment arrangements

You'll also need to sign a training plan (formerly called a ‘commitment statement’). This document outlines the training schedule and what you, the apprentice, and the training provider all expect from each other.

What is an apprenticeship contract in Scotland?

In Scotland, the employer-apprentice relationship is governed by an apprenticeship contract. The most significant difference is that Scottish apprentices often have 'enhanced' protection against being dismissed before their training ends. This means that some reasons that might justify a normal dismissal won't necessarily be enough to dismiss an apprentice early.

Your written contract in Scotland should:

• define the fixed term of the apprenticeship

• provide a clear description of the apprentice's role

• confirm the pay, hours, and other employment arrangements

What are the legal requirements for hiring an apprentice?

Because apprentices have a unique status as both students and staff, you must meet specific legal obligations. In England, Wales, and Scotland, you must provide your apprentice with a contract that's long enough for them to complete their training. You must also ensure they work with experienced staff and learn skills that are relevant to their qualification.

You must also:

• allow them at least 20% of their normal working hours for 'off-the-job' training

• pay them for the time they spend training or studying

• give them the same rights as other employees, such as holiday pay, sick pay, and rest breaks

• ensure they're over 16 and not in full-time education elsewhere

What is the minimum wage for apprentices?

Apprentices are entitled to a specific National Minimum Wage (NMW) rate, which typically increases every April. From 1 April 2025, the apprentice rate is £7.55 per hour. This rate applies if the apprentice is aged under 19, or if they're 19 or over and in the first year of their apprenticeship.

Once an apprentice is 19 or over and has finished their first year, you must pay them the full NMW for their age group.

For more information, read Minimum wage.

What are the apprenticeship funding rules?

The way you fund an apprenticeship depends on the size of your business and where you're located. While the Apprenticeship Levy is a UK-wide tax for large employers, the way that money is handed back to businesses for training varies by nation.

The Apprenticeship Levy

The Apprenticeship Levy is a tax paid by all UK employers with an annual pay bill of more than £3 million. It's charged at 0.5% of your total pay bill, and you get an annual allowance of £15,000 to offset against your levy payment. HMRC collects the levy monthly through the PAYE process.

For more information, see the government’s guidance on the apprenticeship levy.

Apprenticeship funding in England

In England, the government sets 'funding bands' for every apprenticeship standard, ranging from £1,500 to £27,000. This is the maximum amount the government will contribute toward training and assessment. If you pay the Apprenticeship Levy, you use the funds in your apprenticeship service account to cover these costs. If your account doesn't have enough funds, the government pays 75% of the balance, and you pay 25% (co-investment).

If you don't pay the Apprenticeship Levy, you must 'reserve' funding through the apprenticeship service before the training starts. The government usually pays 95% of the training costs, and you pay a 5% co-investment directly to the provider. 

However, since April 2024, the government fully funds training for 16-21-year-olds in small businesses (SMEs). You may also be eligible for an extra £1,000 payment for taking on an apprentice aged 16 to 18, or 19 to 24 with an education, health and care (EHC) plan or care experience.

For more information, see the government’s guidance on apprenticeship funding. 

Apprenticeship funding in Wales

In Wales, apprenticeship funding is managed by Medr (the Commission for Tertiary Education and Research). Businesses of all sizes and across all sectors are eligible for support. Unlike England, the Welsh system doesn't require smaller employers to pay a 5% co-investment; instead, training and assessment costs for approved frameworks are supported directly through the national apprenticeship programme.

You're responsible for paying the apprentice's salary and any training costs that fall outside the formal apprenticeship framework. To access funding, you must work with a contracted training provider who will manage the programme. You cannot access this funding if you use zero-hour contracts. There are also specific incentives available, such as a £2,000 payment for recruiting a disabled apprentice (available until 31 July 2027), though these don't apply to degree apprenticeships.

For more information, see Medr’s guidance on apprenticeships for employers.

Apprenticeship funding in Scotland

In Scotland, apprenticeship training is funded by Skills Development Scotland (SDS). Funding is available for Modern Apprenticeships and Graduate Apprenticeships, with the amount depending on the apprentice's age and the industry sector. Similar to Wales, SDS usually pays the training provider directly. While large employers in Scotland still pay the UK-wide Apprenticeship Levy, they access training support through the Scottish system rather than a digital levy account.

For more information, see Apprenticeships.Scot guidance on funding for apprenticeships.

If you are ready to hire your first apprentice, you can make an Employment contract. If you need a more bespoke document for your apprentice (including an apprenticeship agreement or contract), you can use our Bespoke legal drafting service. Do not hesitate to Ask a lawyer if you have any questions or concerns.