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Focus on Manufacturing

The Apprentice - hiring and firing

Lord Sugar seems to hire and fire his apprentices at will, apparently based on the flimsiest of decisions about their abilities, performance or suitability to work with him. But is it really so easy to dismiss a trainee from your business, or are there hidden pitfalls that could make the reality of appointing The Apprentice more of a Dragons’ Den than a Match of the Day?

The answer is, as with most employment issues, that it depends upon what the contract says. For centuries, apprentices were employed on contracts of employment and as the law developed, they gained employee rights as well as specific rights relating to apprentices.

As long as the primary purpose of the engagement is training, and the obligation to carry out work is secondary, the contract may well be one of an apprenticeship. The key difference between “ordinary” employees and common law apprentices is that the law makes it much harder to dismiss apprentices. Case law tells us that acts which would ordinarily result in dismissal for an employee may well be insufficient to justify the dismissal of an apprentice, unless the ability to teach them is fundamentally undermined because of their misconduct.

Equally, the potential redundancy of an apprentice should be approached with caution for the same reasons: unless there is a total closure of the business or a fundamental change to the character of the business, the apprentice enjoys a protected status which means that their redundancy is very hard to justify.

The potential compensation for unlawfully dismissing a common law apprentice can be damages for the lost earnings for the remainder of their contract, which can be several years’ salary in some cases, which means that drafting mistakes can be very costly.

By contrast, modern apprenticeship agreements are more straightforward to issue and terminate, as long as they meet certain statutory conditions which include the apprentice agreeing to work for you, the agreement itself meeting a prescribed format in terms of the information it contains, it being governed by English law, and being entered in to in connection with a qualifying apprentice framework.

Agreements meeting those standards can be issued with much more flexibility, including being of an indefinite or fixed duration and with or without a notice provision.

There is no doubt that the recruitment of apprentices can add huge value to your business, and can lead to the recruitment and retention of good quality staff who stay with you for a long time, particularly in the manufacturing sector where hands-on experience from an early stage is invaluable.

Add to that the potential apprenticeship levy, due to come in to force next year, and there are real incentives to the recruitment of apprentices. However, the pitfalls can be substantial, so it is worth checking your contracts and taking early action if you think it is needed.

The moral of the story? Check your contracts carefully and ensure that apprentices are clearly defined as such, and your managers know the pitfalls that can occur. Don’t rely on television shows as examples of good employment practice!

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