Wage subsidy for apprentices and trainees during COVID-19

The Federal Government has announced financial support for small to medium-sized businesses to improve business confidence. The wage subsidy will help continue development of the skilled workforce.  

The government anticipates the wage subsidy for apprentices and trainees will support up to 70,000 small businesses, employing around 117,000 apprentices and cost $1.3 billion across 2019-20 and 2020-21.  

Wage subsidy for apprentices and trainees 

The wage subsidy is to support small business to retain their apprentices and trainees. Employers that meet the eligibility criteria can apply for a wage subsidy of 50% of the apprentice or trainee’s wage, paid during the 9 months from 1 January 2020 to 30 September 2020.  

Employers will receive a reimbursement per eligible apprentice or trainee up to a maximum of $21,000 ($7,000 per quarter).  

If a business is not able to retain an apprentice or trainee, the wage subsidy will be available to a new employer. 

Alternatively, any displaced apprentices or trainees will be supported to find re-employment through The National Apprentice Employment Network using their network of host employers across Australia. 

What is the eligibility criteria?  

There are three requirements for an employer to be eligible and receive the wage subsidy:  

1. An employer with an apprentice or trainee must have less than 20 full-time employees 
   
2. The apprentice or trainee must have been in training with the small business as at 1 March 2020 
   
3. The employer must complete an eligibility assessment undertaken by an Australian Apprenticeship Support Network (AASN) provider – including Apprenticeships Support Australia. 
   

The wage subsidy will also be available for any employer or Group Training Organisation that re-engages an eligible out-of-trade apprentice or trainee.

When can I access the subsidy?

From early April 2020, employers can register for the subsidy with final payment claims to be lodged by 31 December 2020. All AASN providers can help employers on how to apply for the subsidy, eligibility information or any other related questions. 

Let’s look at an example for Star Hairdressing 

Star Hairdressing is a small business that employs 7 people, including two full-time Australian apprentices.  

Joe is a first-year Australian apprentice, aged 22, undertaking a Certificate III qualification. He commenced his apprenticeship with Star Hairdressing on 10 February 2020. Joe receives a weekly wage of $532.89.  

Amelia is a third-year Australian apprentice, aged 29, undertaking a Certificate IV qualification. She commenced her apprenticeship with Star Hairdressing on 20 November 2017. She receives a weekly wage of $772.71.  

An eligible apprentice or trainee employer will receive 50% of the apprentices’ wages that have been paid by the employer since 1 January 2020. 

Star Hairdressing will receive:  

• $9,059 subsidy for employing Joe for 10 February 2020 to 30 September 2020, and 
  
• $15,068 subsidy for employing Amelia for 1 January 2020 to 30 September 2020. 
  

Further resources 

Apprenticeship and trainee wage subsidy information is available at: 

• The Department of Education, Skills and Employment  
  
• Australian Apprenticeships  
  
• Apprenticeships Support Australia 
  

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