With Government plans to double the number of apprenticeships, employers may need to brush up on the way apprenticeships work, says Anna Denton

Once upon a time apprenticeship involved a period of 7 years of living with and learning from your “master” under the auspices of a craft guild. Despite this system all but breaking down, the key elements of this archaic relationship persist: the core purpose is training, taking place over a fixed-term period during which the employer has restricted abilities to dismiss.

Whilst increased funding and incentives and the desire to plug the skills gap is attracting employers back to this model of engagement, they need to be aware of the special implications of such a relationship.

Firstly, in order for an apprenticeship to be formed it needs to recorded in writing, unlike a contract of employment which can come into being as a result of an oral agreement.

Secondly, the fixed term nature of the relationship needs to be appreciated. Unlike a normal employment relationship the employer cannot bring the contract to an end, for example, because of a downturn in work or because of a change in funding arrangements. If you did try and terminate the relationship earlier, you would not only face a claim for damages for the loss of wages for the rest of the fixed-term but also compensation for the loss of training and loss of status, the argument being that the apprentice is less employable because they did not complete their training. You could expect damages to be much higher than for unfair dismissal alone.

In addition, you will be expected to manage performance and absence issues in a manner which results in the apprentice achieving the required standards. Generally, you can only terminate the apprenticeship if their conduct is such that it makes it impossible for you to carry out the central purpose of the relationship ie:- teaching them their trade. This is a much higher threshold than you will be used to.

What should an apprenticeship agreement cover?

Apprenticeship is not only a relationship of employment but of learning and teaching, in fact the law views it as learning foremost with any work you get out of the apprentice as very much a secondary element. As a minimum therefore any written agreement should detail what skills the apprentice can expect to learn or the programme of training that will be put in place. The Agreement should make it clear what is expected of the apprentice and what will need to be demonstrated in order to be proficient enough to pass out of the scheme. For example, this might be the obtaining of externally assessed qualifications.

If you are not providing all the training yourself but a third party training provider is, you may want to put in place a tripartite agreement setting out what the apprentice can expect from the third party but at the very least you should not warrant the quality of training that that third party is responsible for, or leave yourself exposed to claims for failing to provide the training adequately, if this is out of your control. Unless otherwise stated you will be expected to help the apprentice to secure the relevant qualification to enable them to pursue a full-time career.

You may also want to consider the following provisions in any written agreement:-
· The length of the fixed-term the apprenticeship is to last for (there is no set period in the law);
· If the apprentice is under 18, signature by their parent or guardian;
· A probationary period prior to the commencement of the formal apprenticeship to make it easier to remove any unsuitable candidates at the outset;
· The appointment of a mentor or person with special responsibility for apprentices, who will take care of their welfare during the apprenticeship;
· Details of how progress will be reviewed and monitored and how regular this will be;
· The ability to terminate the relationship if the apprentice does not attain the necessary standards after a sufficient opportunity to do so;
· Requiring those who leave after the end of the apprenticeship to pay back certain training fees if they do not stay with you for a stated period of time; and
· Arrangements to transfer the apprentice in the case of a redundancy situation or at least to make reasonable efforts to find alternative work for them to enable them to complete their training.

The signing of this written agreement should be witnessed by independent witnesses who are able to confirm that the signatories entered into the agreement freely and willingly.
What other obligations will I have towards an apprentice?

Your duties in discrimination law, and in the case of public authorities, wider equality duties, will apply to apprenticeships just as much as to other forms of worker. In particular employers need to take care not to apply age limits to apprenticeship schemes, especially as the Government has lifted former age restrictions on funding. Other eligibility criterion should be reviewed to ensure they are not indirectly age discriminatory, for example, requiring recent GCSEs.

You must comply with the National Minimum Wage Act 1998 – whilst there are provisions entitling you to pay lower rates to younger staff and a lower rate for those in “accredited training” that will only last for 6 months. Likewise you will have obligations under the Working Time Regulations as regards rest breaks and paid holidays and the usual health and safety obligations akin to those for all staff.

However, you should also make sure you that you entitle your apprentices to the same benefits as other staff, unless you can objectively justify treating them differently. Clearly if they are treated differently you could risk discrimination claims including under the legislation protecting Fixed-term Employees.

Anna Denton, Morgan Denton Jones LLP
adenton@mdjlaw.co.uk