Changes to apprentice rules from October 2010Tuesday, August 3rd, 2010
The changes proposed in the Low Pay Commission’s eleventh National Minimum Wage Report were accepted by the Coalition government in June and included a new minimum rate for apprentices. The Regulations introducing the arrangements for apprentices were made on 22 July and come into force from 1 October 2010.
Currently, apprentices are either entitled to the relevant minimum wage that applies to workers in general or are excluded from the minimum rate altogether. Those engaged under a contract of apprenticeship, or treated as such, are not entitled to the NMW if they are
- under age 19, or
- in their first 12 months of employment as apprentices.
On reaching age 19, an apprentice becomes entitled to the NMW rate for ages 18 to 21 (18 to 20 from October 2010). Or, after completing one year as an apprentice (even if part of that apprenticeship was with another employer), the appropriate NMW rate for the apprentice’s age must be paid.
New rules from 1 October 2010
All of the existing NMW rules for apprentices are replaced by new, somewhat complex, Regulations. The changes relate to the definition of who is, or is not, an apprentice. The “age 19” and the “12 months” rules are not changing.
Workers who do not qualify for the NMW rates are defined as those participating in a scheme
- under any of the following Government arrangements:
- in England, Programme Led Apprenticeships,
- in Scotland, Get Ready for Work or Skillseekers,
- in Northern Ireland, Programme Led Apprenticeships or Training for Success,
- in Wales, Skill Build, or
- designed to provide training, work experience or temporary work, or to assist in seeking or obtaining work, which is
- a Government arrangement that is not (1) one of those specified above, or (2) one of those in which a worker is treated as being employed under a contract of apprenticeship (see below), or
- not provided under a Government arrangement but is funded in whole or in part under the European Social Fund, (i.e. funding for employment and skills under national and regional programmes) and who do not otherwise qualify because, for example, they are working for a trial period of more than six weeks with a prospective employer under a Government arrangement but are engaged under a contract of employment.
The new National Minimum Wage (NMW) rate of £2.50 per hour applies, from the first pay reference period starting on or after 1 October 2010, to workers who
- are employed under a contract of apprenticeship, or treated as employed under a contract of apprenticeship,
- are within the first twelve months of the employment or who are not yet age 19, and
- are not specifically disqualified from entitlement to the NMW (see above).
Workers are treated as being engaged under a contract of apprenticeship if
- they are engaged under a contract of employment and,
- are engaged under any of the following Government arrangements:
- in England, Apprenticeships or Advanced Apprenticeships
- in Scotland, Modern Apprenticeships
- in Northern Ireland, ApprenticeshipsNI or Modern Apprenticeships
- in Wales, Foundation Modern Apprenticeships, Modern Apprenticeships, Foundation Apprenticeships or Apprenticeships.
The supporting guidance on these changes comments that the 1999 Regulations have been amended many times and BIS is aware of the need to consolidate these Regulations. The intention is to produce a consolidated version of the Regulations in 2011, if resources permit.