Small firms ignorant of apprenticeship legislation

Small businesses risk a £39.2m bill as a result of confusion over apprenticeship legislation, it has been claimed.

Businesses have been warned they face a legal minefield if they are unaware of the requirements of taking on new apprentices.

A 7% increase in the number of apprenticeships in 2009 resulted in an extra 15,695 recruits according to price comparison site Coverzones.com.

However, the organisation has warned that companies risk a fine of £2,500 for each day they employ an uninsured apprentice.

Simon Ball, chief executive of Coverzones.com, said: “While the rise in apprenticeships is of course, very encouraging news for the UK economy, the government is potentially leading smaller businesses into a bear trap by not clarifying the legal implications of taking on trainee staff, including apprentices.”

Ball said as many as 50% of small businesses were unaware that apprentices or temporary workers come under the same legal classification as full-time employees, and the government is not doing enough to communicate the law.

“Smaller companies should be applauded for their support of young people and development of practical skills; however government bursaries and incentives would not be enough to cover the cost of any accidents.

“What small businesses need now is greater guidance on their legal obligations, to ensure that the economy and the apprenticeship schemes continue to flourish.”

© Crimson Business Ltd. 2010