Tackling exploitation must be 'a top priority' for new Institute of Apprenticeships - ACCA

Posted On: 
5th January 2017

Head of policy for Europe at the Association of Chartered Certified Accountants, Anthony Walters, responds to new report that reveals apprentices are being paid less than their legal entitlement. 

Yesterday’s report from the Low Pay Commission that revealed that 18% of apprentices are being paid less than their legal entitlement is certainly alarming and frustrating for those who are working to champion the value of vocational training. While the news is a reminder of the need for strong regulation to clamp down on unscrupulous and illegal working practices, as well as ongoing government support to improve the awareness and perception of apprenticeships among young people. It is absolutely vital that these headlines do not act as a deterrent for non-graduate routes into professions.

With the Apprenticeship Levy coming into force from April, tackling issues concerning exploitation should be a top priority for the new Institute of Apprenticeships. Intended to be led by employers, the Institute is an opportunity to send a message from business, to business, about what is expected when it comes to fair remuneration. Preventing such misbehaviour will require a strong regulator with the power to punish instances of non-compliance regarding minimum pay. While apprenticeships should offer an opportunity for employers to off-set some of the considerable investment in training and education of inexperienced young staff, it is inevitable that in some instances this will be exploited by firms who themselves might be struggling in an uncertain economic climate.

The potential for further long-term harm to the reputation of apprenticeships is considerable. Research undertaken last year by ACCA (the Association of Chartered Certified Accountants) showed that apprenticeships are facing something of an image problem amongst many 16-18 year olds: over half of young people polled thought that apprenticeship routes would lead to them earning less over the course of their career than if they studied at University. They are still seen as the ‘poor relative’ when compared with traditional forms of higher education.

Reports of unfair pay practices are likely to confirm students’ poor image of apprenticeships and damage enrolment numbers. If the government is to succeed in encouraging more young people to take up apprenticeships there needs to be greater transparency over which apprenticeships can lead to the same entry level roles and pay grades as graduate courses. Ensuring apprentices are fairly paid during their study is the first step in breaking down these perceptions around earning potential.

For many students the financial implications of this research could put apprenticeships out of reach. In many cases graduate routes present an unmanageable financial burden. When fairly paid, apprenticeships can be a tool for social mobility for those who rely on paid, on-the-job learning as a route in to a skilled career. For accountancy, they can be a vital route into a highly sought after and well-remunerated career – one where qualified and skilled practitioners can rise to the very top of industry - at a time where access to the professions has rarely seemed so onerous for those from diverse or disadvantaged backgrounds.

All apprenticeships should aspire to the level of opportunity and quality offered by graduate routes. While such instances of their abuse is lamentable, however, with the right encouragement from government and appropriate regulation both employers and students should see them as an invaluable pipeline for maintaining a highly skilled and productive workforce.

Anthony Walters is regional head of policy for Europe and the Americas at ACCA (the Association of Chartered Certified Accountants)