Small Employer Indicator - 2024/25 Rule Change

The Small Employer flag is not relevant to starts after 1st April 2024 (unless perhaps if they're restarts). It's now simply that non-levy employers have to pay co-investment if the apprentice is 22+ when they start (or 25+ if they have an EHCP).

If it's showing up as requiring co-investment, the apprentice is under 22, and the employer is definitely non-levy, then contact the apprenticeship service. I've had a handful of apprentices on that report with all zero figures, which is odd but fine. Watch out for employers that used to pay the levy, but don't any more. They still have a levy account, and still get charged as insufficient funds even when the apprentice is under 22. It's really unfair, and I've had a query about it in with ESFA for about a year but with no answer.

Thanks Ruth - I will raise it with the Apprenticeship Service.

@... If you work it out, I'd love to know the answer in case similar happens to us!

Hello Ruth Canham-James

I raised my query with the Apprenticeship Service and this is the reply:

"I can confirm the status on the apprenticeship service for THE EMPLOYER is 'LEVY' - this indicates that the employer had declared levy at some point since their accounts creation.
 
The system does not automatically convert levy accounts to non levy (even though the opposite is permitted) if declarations are stopped/no longer made or the PAYE removed and re-added using the non-levy route (PAYE Scheme and Accounts Office Reference Number (AORN)).
 
As per the Apprenticeship Technical Funding Guide from August 2023 under 'Co-investment waiver for new starts from 1 April 2024'

Where employers are showing as levy payers in their Apprenticeship Service account, but haven’t declared / paid any apprenticeship levy within the last 2 years (from when the apprentice starts) then in order to waive the co-investment requirement employers will need to contact the Apprenticeship Service Support Desk on 08000 150 600 or email helpdesk@manage-apprenticeships.service.gov.uk. The Support Desk will then talk employers through the process of how to update their AS account. 

 Due to the changes to co-investment waivers, the resolution provided to most levy employers that no longer declare levy is that they will need to remove their PAYE Scheme from their current account in order to create a brand new non-levy apprenticeship service account.

Once the new account has been set-up and provider permissions granted, training providers will be able to use the Record a change of employer process to move the learners from the old account to the new account from the original start date and rename their old account to not be used and remove permissions.

To confirm the correct actions for your employer, please ask them to contact the helpdesk directly so we can investigate and assist further."

Now we've just got to get the employer to engage with this process.....!!

@... I did wonder if that might be the case. Some employers insist they're one sort of account when they're not. We can never be sure until we put in the ILR and get the Apps Monthly Payment Reports, but we'd like to know before that.

That's great! Thank you 🙂 Nice of them to let me know the answer to my query. I hadn't spotted the new guidance. I've been asking about this hypothetically for years, but we've never actually had this scenario. 

So basically they need a whole new DAS account, that's a bit of a faff! And they have to rename their old account (that's actually really easy). I guess the choice is pay the 5% or do the admin, or you'll withdraw the apprentice.

It would be very helpful if we were able to have this info before the ILR Return and Reports flag up issues... 😊!! Its definitely going to be tricky with some employers - especially those who have barely mastered getting their account set up, let alone having to make these sort of changes....!

Thanks