Covid-19 support for business: Apprentice Wage Subsidy

Are you struggling to keep track of what’s available to help businesses in these uncertain times? We hear you and we’re here to help!  

In her series of Coronavirus (COVID-19) business support blog posts Jennifer Lawrence, Senior Policy Adviser, Industry Policy will cover topics to help your business survive COVID-19. Find out more about cash flow, income support, what’s available from the banks, tax relief and more. To kick things off we’re focusing on the apprentice wage subsidy announed by the Federal Government.

Apprentice wage subsidy  

Are you a small business owner? Do you employ or host apprentices? Read on, you may be able to get 50% of apprentice wages back.  

What’s available?

$1.3 billion to help small business employers keep their apprentices on the books. Eligible small business employers and hosts can apply for a reimbursement of 50% of the wages paid to eligible apprentices from 1 January to 30 September 2020. You could be reimbursed up to $7,000 per apprentice per quarter.

What’s an eligible business? A business that had less than 20 employees on 1 March 2020 and employed or hosted one or more eligible apprentices on this date. The business will remain eligible for the wage subsidy provided they continue to employ or host the same apprentice.
Who’s an eligible apprentice? A person employed in an Australian Apprenticeship at the Certificate II level or above, with a Training Contract formally approved by the state training authority and who was employed or hosted by an eligible business on 1 March 2020.

Are there exclusions?

Employers are not eligible if they have received or are currently receiving the Australian Apprentice Wage Subsidy or equivalent Australian Government wage subsidy for the apprentice, or if the apprentice was suspended or stood down on 1 March 2020.
If an employer lets an eligible apprentice go they will no longer be able to access the wage subsidy if they re-hire that apprentice or re-engage a different eligible apprentice.

 What happens if I have to stand down my apprentice?

If a business suspends an eligible apprentice after 1 March 2020 for less than six months, they will be able to access the wage subsidy when the apprentice returns to the same employer. If it has been longer than six months, the wage subsidy will no longer be available.  

I employ apprentices, how do I apply?

From 2 April 2020, you can apply by contacting your local Apprenticeship Support Network. Once approved, you can seek reimbursement by completing a Supporting Apprentices and Trainees Claim Form. Reimbursements are for a three month period and are paid in arrears. The first claim will be for the period 1 January 2020 to 31 March 2020.  

I host apprentices, how do I apply?

Your Group Training Organisation (GTO), as the employer, will apply for the wage subsidy. Applications open on 2 April 2020. Your GTO will receive the reimbursement and must pass this on to you. Your first reimbursement will be equal to half of the wages paid by the GTO to the apprentice (not half of what you paid to the GTO) between 1 January and 31 March 2020. You will remain eligible for the reimbursement if you continue to host the same apprentice.  

What if I employ or hire an apprentice after 1 March 2020?

Businesses can continue to hire apprentices. However, wages are only eligible for the subsidy if the apprentice was employed or hosted by a small business on 1 March 2020.

If an eligible apprentice is let go by their host but remains employed by the same GTO, a business of any size that subsequently hosts the apprentice will receive the wage reimbursement.

If an eligible apprentice is let go by their employer:

A business of any size that re-engages them may be able to access the wage subsidy for that apprentice from the time they are employed to 30 September 2020.
A GTO that re-engages them can access the wage subsidy for that apprentice from the time they are employed to 30 September 2020. The GTO can choose to keep the reimbursement or to pass it on in-full or in-part to a host business.

Can I claim the Apprentice Wage Subsidy and the JobKeeper Payment?

You can’t claim both at the same time. However, you can claim one and then transfer to the other.

In other words, if you meet the eligibility for the Apprentice Wage Subsidy and the JobKeeper Payment, you should:

Contact your local Australian Apprenticeship Support Network now to register for the Apprentice Wage Subsidy to receive a reimbursement of half of the wages paid to the apprentice for January to March 2020, and
Register your interest for the JobKeeper Payment on the ATO website. The ATO will then contact you to apply for the Payment and nominate your eligible employees. JobKeeper Payments are paid to employers monthly in arrears with the first payment period commencing 30 March and the payment being made in early May. The payment is $1500 per employee per fortnight (noting that this will become the minimum amount the employee must be paid before tax).

Want more information? Contact your state Master Builders Association or your local Apprenticeship Support Network.