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Incentives for Apprenticeships

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Supporting Australian Apprentices and Trainees wage subsidy – the options for businesses.

The federal government has introduced a number of measures to help keep apprentices employed as part of its COVID-19 response, with its JobTrainer package including the expansion and extension of the Supporting Apprentices and Trainees wage subsidy.

Under the updated Supporting
Apprentices and Trainees initiative, eligible small and medium-sized businesses can apply for a wage subsidy of 50 per cent of an apprentice’s or trainee’s wages paid until March 31, 2021.

The Incentives for Australian Apprenticeships (IAA) program had been set to be introduced last year, however due to the impact of COVID-19, the government has revised its implementation, with the IAA now set to commence from July 1, 2021.

SUPPORTING APPRENTICES AND TRAINEES WAGE SUBSIDY
The government had initially introduced the Supporting Apprentices and Trainees wage subsidy to assist small businesses, with it subsequently expanded to include medium-sized businesses, and also extended to run into 2021.

The Department of Education, Skills and Employment (DESE) website provides the following information on business eligibility:

SMALL BUSINESSES
• May be eligible if they employ fewer than 20 people; or
• Are a small business with fewer than 20 people, using a Group Training Organisation (GTO); and
• The apprentice or trainee was undertaking an Australian apprenticeship with the business on July 1, 2020 for claims after this date (prior claims will continue to be based on the March 1, 2020 eligibility date).

MEDIUM-SIZED BUSINESSES
• May be eligible if they employ fewer than 200 people; or
• Are a medium-sized business with fewer than 200 people, using a GTO; and
• The apprentice or trainee was undertaking an Australian apprenticeship with the business on July 1, 2020.

As advised via DESE, any employer (including all small, medium or large businesses and GTOs) that re-engages an apprentice or trainee displaced from an eligible small or medium-sized business may also be eligible for the subsidy.

Claims for both small and medium-sized businesses are now open, with DESE advising that final claims for payment must be lodged by June 30, 2021.

BOOSTING APPRENTICESHIP COMMENCEMENTS
In addition to the Supporting Apprentices and Trainees wage subsidy, the federal government has introduced the Boosting Apprenticeship Commencements wage subsidy, which supports employers taking on new apprentices or trainees.

As advised via DESE, any business or GTO that engages an Australian apprentice on or after October 5, 2020 may be eligible for a subsidy of 50 per cent of wages paid to an apprentice between October 5, 2020 and September 30, 2021 (up to a maximum of $7,000 per quarter).

DESE advises that the subsidy, which is capped at 100,000 places, is available to employers of any size, industry or geographic location, while it is not available for apprentices receiving any other form of Australian government wage subsidy, with final claims for payment needing to be lodged by December 31, 2021.

Meanwhile, employers and apprentices may be eligible for the Additional Identified Skills Shortage (AISS) payment, under which financial incentives are provided across ten occupations experiencing national shortages.

Further information on the Supporting Apprentices and Trainees and Boosting Apprenticeship Commencements wage subsidies can be found at the DESE website: www.dese.gov.au, and further information on the AISS payment can be found at the Australian Apprenticeships website www.australianapprenticeships.gov.au

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