The cost of losing an apprentice part way through training.
Updated: Aug 10, 2020
Employing and training an apprentice is an investment of both time and money for the employer, the apprentice and the training provider. So it goes without saying that everyone involved wants to achieve the best return on that investment possible. The employer aims to increase skills within its business. The training provider, college or university wants to achieve a positive completion outcome and the apprentice hopes to develop skills that will make him or her more employable, open up new opportunities and increase their earning potential. But for a number of reasons, around 40% of apprentices leave their apprenticeship early, without completing, meaning everyone involved in the apprentice journey loses out.
Employers not only lose the cost of buying the apprenticeship training in the first place, but they never realise the increase in skills. Training providers, colleges and universities suffer because their completion levels go down and apprentices don’t achieve which has an impact not just on their social mobility, but can also trigger a cycle of starting something and failing to finish.
In this guide, we will talk about the cost of losing an apprentice part way through their training, and take a look at some of the steps an employer can take to prevent this.
Understanding the cost of training and assessment
The cost of apprenticeship training may vary with each provider, however all apprenticeships have been allocated to one of 15 funding bands. Each band has an upper £ cap, which limits the amount of money an employer can use from its apprenticeship levy funds (if they are an apprenticeship levy payer) or that Government co-investment will cover. Any over the cap contribution must be met in full by the employer. It is therefore vitally important that employers understand the cost of apprenticeship training and assessment and negotiate the payment terms with their chosen provider.
Stopping payments for apprenticeship training and assessment that's no longer required
Employers who pay the apprenticeship levy and use their levy funds to pay for the training of an apprentice who leaves their apprenticeship early can stop payments to a training provider at the click of a button via their online digital apprenticeship service (DAS) account. This will prevent any further unnecessary payments and enable employers to safeguard funds, or use them to train another apprentice if they choose to.
Employers who do not pay the levy, or who have used up all of their levy funds, may receive co-investment from Government to pay for a large part of the apprenticeship training and assessment. In such cases, the employer may be required to make a contribution (currently 10% but this is set to reduce to 5% in 2019) and depending on the payment terms it negotiated with the provider (see Understanding the cost of training and assessment above), the employer may find itself in a position where it has overpaid at the point when the apprentice leaves before completing.
We would advise the employer to notify the provider immediately they are aware that the apprentice has left as there are several steps the training provider must take to bring training and the draw-down of funding to a halt. The employer may also be able to recover some of the overpaid co-investment or over the cap costs but again, this very much depends on the payment terms it agreed at outset with the provider
To find out more about the funding bands visit the governments website here.
End Point Assessment (EPA)
An apprentice who studies an apprenticeship standard (as opposed to an apprenticeship framework – these are being phased out) is required to undertake an end point assessment (EPA) at the end of their training. It is the employer (supported by the training provider) who must decide whether or not the apprentice is ready to take the EPA – this decision process is known as the “gateway”.
Should the apprentice fail the EPA, the employer will be required to fund the full cost of any further retakes, although in some cases, providers may be prepared to offer a free retake. This is something the employer should consider when negotiating training provider costs and payment terms.
Many employers would argue that it should be the responsibility of the training provider to decide when the apprentice is ready to take their EPA but this is not how the process works. It’s vital therefore that employers are involved in the apprentice training; understand where the apprentice is at every stage of their learning; communicate regularly with the training provider; and conduct regular apprentice reviews to check learner progress.
Remember – a failed EPA could be a costly exercise.
Can an employer charge an apprentice for their training?
Some employers may charge employees for certain types of training and there are examples of penalty clauses in employment contracts which seek to recover training costs or tie in employees for a period of time after qualification has been achieved. However, the situation for apprentices is very different. Fees should not be passed on to apprentices by their employers or providers under any circumstances. Whilst it may be frustrating for employers to hear, the Education and Skills Funding Agency (ESFA) make it clear that where an apprentice leaves their programme early, employers must not claim training or assessment costs back from ex-apprentices.
Apprenticeship duration and evidencing on and off-the-job hours
Every apprenticeship is different and can take anything from one to five years to complete so it goes without saying that the investment of time is significant. Apprentices are required to take time out of their normal working day to attend training while employers need to invest time to help the apprentice learn the skills required and develop on-the-job. This is a huge employer commitment. But with the recent reforms to apprenticeship funding, time has an even bigger role to play in successful apprenticeship completion.
Under the new rules, the employer must ensure the apprentice spends 20% of their contracted employment hours across the whole apprenticeship doing off-the-job training – this includes things like attending lectures, taking part in role play, online learning, simulation exercises, shadowing, mentoring, industry visits and time spent writing assignments. You’d think this would be relatively straightforward for an apprentice doing day release – that is spending one day a week at their place of learning. Unfortunately, when you consider the fact that a college day is generally shorter than a work day and then you take off provider shut down periods, 20% looks more like 8%. Fortunately, Rubitek Core provides an online timesheet that monitors apprentice on and off the job hours and allocates them by activity accordingly so that employers and training providers can monitor apprentice hours and make adjustments.
Given the investment of money, time and these new commitments, employers now more than ever need to deliver apprenticeship programmes that work and ensure the apprentice is engaged from day one to completion.
Why do apprentices fail to complete?
There are some really interesting reports available that look into apprentice completion rates and the reasons why learners drop out early. One common reason for non-completion is apprentice disengagement and this can be for a variety of reasons such as: difficult relationships whilst at work or training; poor commitment from the apprentice or the employer; a lack of a strong support network; or a lack of structured training. For employers, creating a positive environment that starts with the end in mind – that is achievement – can help keep an apprentice engaged and on track. But let’s suppose an employer has done all that it can to create the right environment. What can it do to spot the early signs of potential apprentice disengagement?
Improving engagement with apprentice management software
Rubitek is a cloud-based apprentice and learner management platform with a suite of tools that support learning to improve engagement and evidence the increased employer commitments as part of the reforms. Featuring real time management reports, the software helps employers to identify the early signs of apprentice disengagement and create opportunities for intervention to get the learner back on track. There’s never been a better time to get the most from your apprenticeship programmes. If you would like more info on our apprenticeship management platform, call us on 0330 133 0540 or email firstname.lastname@example.org.