Scrap the apprentice minimum wage, AELP demands

The apprentice minimum wage should be scrapped, the Association of Employment and Learning Providers has urged.

Instead, the association believe apprentices should simply be paid the national minimum wage.

The pay increase – which could see some apprentices more than doubling their wages – would be “appropriate” and would also benefit employers, AELP boss Mark Dawe told FE Week.

“Given that apprentices are employees and they’re working a substantial amount of the time, they should be paid the same rate as every other worker,” he said.

The “general feeling” among AELP members, at both board level and among the wider membership, was that “the apprenticeship minimum wage is now not appropriate and ought to be scrapped”.

Mr Dawe acknowledged that paying the national minimum wage in “lower wage sectors, with lower margins” would be “challenging for the employers”.

“What our providers would say is that you get better retention of staff, whether they’re apprentices or not, paying reasonable wages,” he said.

“So the benefit comes through from staff loyalty, retention and getting the right staff, which outweighs some of these concerns.”

The apprentice minimum wage, currently set at £3.70 an hour, applies when an apprentice is under the age of 18, and for those aged 19 and above in the first year of their apprenticeship.

Apprentices aged 19 and above are entitled to the national minimum wage, which varies according to age up to £7.83 per hour for those aged 25 and above, from the second year of their apprenticeship.

Being paid at the national minimum wage rate of £4.20 an hour for 16 and 17-year-olds would represent a 13 per cent pay rise for the youngest apprentices currently on the apprentice minimum.

For those aged 18 to 20 it would be a 59 per cent rise, while for those aged 21 to 24 it would be a 99 per cent increase. Those aged 25 and above would have a massive 112 per cent pay rise.  

The apprentice minimum wage was introduced in 2010 to both protect apprentices from exploitation and to encourage employers to take on apprentices.

It’s set at a lower rate than the national minimum wage to reflect the fact that apprentices are still in training.

Despite this, Mr Dawe said that paying apprentices the full minimum wage was justified as they “still make significant contributions to those organisations very quickly, and therefore we believe that they deserve above the wage that they’re getting”.

“It’s about showing value in your staff, including your training staff.”

Being paid the same as other employees would also be fairer for apprentices, he said, particularly for older apprentices.

“When they’re having to pick up travel and other general working costs, to then be paid less than the normal minimum wage is a real hit for them,” he said.

Most apprentices are already paid well above the minimum.

According to the apprenticeship pay survey 2016, published in July last year, the average pay for all level two and three apprentices was £6.99 an hour.

Hairdressing apprentices were paid less than those in other sectors, and earned on average just £3.34 an hour.

Paying the national minimum wage would also be simpler for employers, who will “know when they’re being compliant or not compliant very simply”, Mr Dawe said.

While 87 per cent of apprentices aged under 18 or in the first year of their apprenticeship were paid at or above the apprentice minimum, according to the 2016 pay survey, this fell to around two-thirds for older apprentices.

While it was “feasible” that apprentices were being deliberately underpaid, “underpayment could also be the result of mistakes”, it said, including a “delay in an apprentice’s pay following a change in eligibility”.