The Apprenticeships incentives program allows eligible employers to make payments to apprentices for commencement and completion of their apprenticeships. The payment scheme operates under the wage subsidy schemes Boosting Apprenticeship Commencements (BAC) and Completing Apprenticeships (CAC). Incentives payments can be made to apprentices, employers, or both. There are some restrictions, however.
Employers are eligible for commencement and completion incentive payments
Under the apprenticeships incentives program, employers who hire Australian apprentices can receive a commencement incentive payment of up to $4,000 for each apprentice. This incentive payment is based on certain criteria that are set out by the Australian Apprenticeship Support Network (AASN). In addition to commencement incentives, there are also completion incentives for Group Training Organisations who employ apprentices who have successfully completed Certificate II levels.
The commencement incentive payment is provided to employers to help them attract and retain apprentices. It depends on the length of the employment relationship between an apprentice and the employer. Employers can apply for the program through the Training Institute of Australasia (TIA). Information and publications on the program can be obtained from the Australian Apprenticeship Support Network (ASN).
The program is funded by a universal levy on employers, which is 0.5% of payroll for companies that pay more than GBP 3 million per year. Initially, the levy was only to be paid on the first year of commencement, but was extended until the end of the 2021-22 financial year. The new levy will provide funding for apprenticeships beyond that first year. This extension of the BAC will provide a further 5% wage subsidy for apprentices who complete the program.
Payments are made under the Boosting Apprenticeship Commencements (BAC) and Completing Apprenticeship Commencements (CAC) wage subsidy programs
These wage subsidy programs encourage employers to hire apprentices or trainees. BAC and CAC pay 50% of an apprentice’s first year’s gross wages. This subsidy amounts to a maximum of $28,000 per apprentice per year. Afterwards, an eligible employer will receive a 5% wage subsidy for each successive year.
BAC wage subsidy claims must be submitted to the Australian Apprenticeship Support Network by 30 June 2022. For CAC wage subsidy claims, employers must submit the claims by 31 December 2023.
BAC and CAC wage subsidy programs support employers and Australian Apprentices. The total value of this subsidy is $7.5 million a year. Employers are encouraged to submit applications as soon as the relevant claim period opens. However, employers should be aware that the process of writing a grant application can take 60 hours.
Policy changes affect eligibility
A recent update to the Government’s Plan for Jobs includes new incentives for employers who recruit apprentices. These incentives will help employers build their capacity and offer high quality opportunities, while also equipping individuals with skills in demand. The changes include increased funding for apprenticeship training and an extension of the deadline for employers to claim incentive payments.
Employers are now free to transfer 25% of their levy funds to another employer and/or use them to fund apprenticeships in their supply chains or partnership with local businesses. The employer will still receive incentive payments for these transfers. If you want to find out more about these policy changes, check out our guide to the changes.
ODEP supports inclusive apprenticeship models to attract diverse candidates and recruit more people with disabilities. Through its work and advocacy, ODEP aims to influence national policy and provide effective practices that support apprenticeships. ODEP is committed to growing the apprenticeship program and recently awarded a $1.9 million grant to Social Policy Research Associates Inc. to develop an apprenticeship inclusion demonstration project. The project will test innovative strategies for expanding apprenticeship programs.
If you are interested, look at the apprenticeships incentives program near you.