Change of Employer - New Co-Investment Amount

You can either get the new employer to pay the lot (really unfair, and you'd have to tell them you were doing that), or you can push the first employer to pay. If you don't do either, you won't get the Completion element. Normally, the new employer would pay 5% of the remaining price you've quoted them. We'd refund the first employer anything they already paid that was above what we were actually funded for during their time as employer.

It should be in their contract that they will pay, so you can send them to debt collection if you see fit, but it doesn't mean you can record they paid when they didn't.

I would love for the Apprenticeship Service to be responsible for collecting employer co-investment. Cut us out as the middle man. They can much more easily monitor levy payers with insufficient funds and generally who owes what, and they could build an invoice and payment part into the Apprenticeship Service website. They could have the fun of chasing employers who refuse to pay, and not penalise us by withholding the Completion Payments.

In the meantime, raise with the Apprenticeship Service, see if you can get them to contact the employer. We try and be pretty strict about non-levy employers paying up front and in a reasonable time frame, or we will withdraw.

Feel for you in this scenario Rachel - this is something that really bugs me.

Even though I agree with everything Ruth has said. From an employer engagement point of view if you're going to refer them to debt collection for a "small" amount of money - the chances of them going to another training provider for any future business is enhanced. 

In 23/24 we lost a £1800 completion payment because a Levy company had a shortfall and owed us £16. We had the training assessor, head of department, finance department all trying to contact the employer & in the end we absorbed the loss. 

We contemplated the idea of not letting the learner go into gateway until co-investment was 100% paid but we didn't want to penalise the learner for the employers negligence. 

100% with you though Ruth - wish the apprenticeship service would take this task on. Or at least give us the flexibility of us still receiving our completion payments with co-investment due & instead the check in audit is to provide sufficient evidence we tried to contact the employer(s) & we were unable to receive payment... We're currently penalised multiple ways: The £ co-investment amount due, the College's time chasing up unpaid invoices & our completion payments being withheld.

Thanks both -  your suggestions for improvement sound very sensible to me! As the amount due from the original employer is relatively small, our finance team have said they cannot refer it to debt collection anyway. This means that various staff (who have no working relationship to the employer ) have to try to persuade them to pay. As they are already unhappy I imagine this will be a point of conflict....😒

I've contacted the ESFA to see what they come back with but I'm not overly optimistic!

Ryan Wiseman Yes, we wouldn't send to debt collection for an employer we wanted to work with in future. But then, if an employer is refusing to pay, do you want to work with them again? It would likely happen all over again 😕

We've been really lucky with insufficient funds for levy payers, they have all been really good at paying so far. We invoice quarterly. But the fact that I consider that "lucky" says a lot about how unfair the system is. Some providers are unlucky like both of your providers, it's not like you didn't try! We haven't done anything special to not have employers do this to us.

Thought I'd give you an update on my reply from the Apprenticeship Service (spoiler alert - it's not great news for us!!):

"If there is outstanding co-investment when the apprentice completes their course and the completion payment is due - the outstanding co-investment will block the payment being released.
 
You will need to resolve this issue directly with the employer and collect the co-investment from the original employer. The funding rules state 'Employers who do not pay the apprenticeship levy, and levy paying employers with insufficient funds, must co-invest the relevant co-investment rate of the total negotiated price, up to the funding band maximum, towards the cost of the apprenticeship training and assessment.' The co-investment rate in this scenario is 5%.
 
Co-investment contributions should have been covered within your agreement with the employer when first taking on the Apprentice.
 
Agreements entered into between the provider and the employer must be legally binding. Dispute resolution should be in accordance with the terms of the written agreement, which ultimately would be enforceable through the courts (212 - 213)."

Pretty much what I though they would say 😕 I was thinking about what you said @...:

As the amount due from the original employer is relatively small, our finance team have said they cannot refer it to debt collection anyway. 

It's not just the amount they owe, it's the amount they owe plus the completion element you've lost. That might depend on how your contract is worded though. I specifically requested that ours say that, if the employer causes us to lose funding by doing something they shouldn't, or not doing something they should, we will invoice them for that lost funding. Totally allowable if we haven't claimed it from ESFA. So, it's not a small amount if it was a completion.

Oh that's a very interesting point, Ruth Canham-James! I've a feeling our earlier contracts were not as robust as they should be.....but I'll scrutinise the one they signed and see!

Many Thanks