Budgeting the Cost of Hiring an Apprentice as Pay Steps Up

Key Takeaways

• The cost of hiring an apprentice changes during the apprenticeship, so budget for a moving figure, not a single number.
• Pay usually steps up over time, by progress, or both, depending on the award or agreement.
• Time at training is generally part of paid working time, so plan rosters and costs for it.
• Rates and incentives are updated, so check official sources before you finalise any budget.
• Keep clear records of hours, training and pay changes.

Introduction

The cost of hiring an apprentice does not stay still. Pay changes as the apprentice moves through stages, and time spent in training is part of the picture. If you budget on the first week's wage alone, the numbers will drift.

This post takes a narrow view: how to plan for wage progression and training time. For the full overview of apprentice costs, read what is the cost of hiring an apprentice. We do not quote rates here because they change. Use the official pages linked below for current figures.

Why the Cost Moves Over Time

Several things shift during an apprenticeship:

• The apprentice moves to a higher pay stage.
• Awards or agreements are reviewed and rates change.
• The apprentice becomes more productive, so the value you receive rises too.
• Training days and study demands change from year to year.

Treat your budget as a living document. Review it at set points, such as when a new stage begins.

Find the Rules That Apply to You

Pay depends on the award or agreement that covers the work, and on the type of apprenticeship. Start by identifying which applies, then read the apprentice section.

• Look for how pay is set at each stage.
• Check whether any allowances apply, such as tools or travel.
• Check what is said about paid training time.

Official information is on the Fair Work Ombudsman apprentice and trainee pay rates page. If you are unsure which award applies, ask the Fair Work Ombudsman or a professional adviser.

How Wage Progression Works

Awards and agreements differ, but progression is commonly based on one or more of the following:

• Time: pay rises after a set period.
• Competency: pay rises when the apprentice completes a defined part of the training.
• A combination of the two.

Competency-based progression means the apprentice may step up earlier or later than a simple calendar would suggest. You need to know when the training provider confirms that a stage is complete, and apply the change correctly from that point. Put a reminder in your calendar for each expected review.

Plan for Paid Training Time

Training is part of the apprenticeship, and time spent at study is generally treated as paid working time under the arrangements that apply. That means:

• Rosters need to allow for study days or blocks.
• Someone else must cover the work the apprentice would normally do.
• You may need to budget for course costs or travel, depending on the rules that apply.

Ask the training provider for the calendar at the start so you can plan. The tool and setup side is covered in tooling expenses and the cost of hiring an apprentice.

Review the Budget at Each Stage

Put a date in the diary to review costs when the apprentice moves up a stage, when the training calendar changes and when award rates are updated. A short review stops surprises and keeps your numbers honest. Share changes with whoever does your books, so invoices and forecasts reflect the real figure.

Include On-Costs

Wages are one part of the total. Other costs you should consider:

• Superannuation and other payroll costs.
• Insurance.
• Protective equipment and uniforms.
• Supervisor time spent teaching and checking work.
• Tools, if you provide them.

When Future1st employs the apprentice, we handle payroll and training administration. Ask us what that covers for your situation, so you know what stays with you.

Get the Pay Right

Underpayment can lead to back-pay and other consequences. Keep records of hours worked, training time and each change to pay. Our post on the real cost of hiring an apprentice correctly explains the financial risk, and managing the true cost of hiring an apprentice safely covers fairness. If your organisation has extra obligations, see recruiting council apprentices compliance standards.

Check Funding and Incentives

Government support for employers can change. Check the Australian Government financial support page for employers before you rely on any payment, and confirm the rules for your situation.

Related Resources

• The Real Cost of Hiring an Apprentice Correctly
• Recruiting Council Apprentices Compliance Standards
• Managing the True Cost of Hiring an Apprentice Safely
• Tooling Expenses and the Cost of Hiring an Apprentice
• Hire an apprentice with Future1st
• Fair Work Ombudsman: apprentice and trainee pay rates

Frequently Asked Questions

Does an apprentice's pay stay the same during the apprenticeship?

Usually not. Pay generally steps up by stage, time or competency, depending on the award or agreement.

Do I pay for time at training?

Time at training is generally treated as paid time under the arrangements that apply. Check your award or agreement and confirm with the Fair Work Ombudsman.

How do I know when to increase pay?

Check the award, and ask the training provider when the apprentice completes each stage. Record the date and apply the change.

Can Future1st handle payroll?

Yes. When Future1st employs the apprentice, we handle payroll and training administration.

Where do I find current rates?

Use the Fair Work Ombudsman page linked above. Rates and incentives change, so avoid relying on old figures.

Plan the Whole Apprenticeship, Not Just the First Week

A good budget follows the apprentice through each stage and includes study time. To talk through how it would work for your business, hire an apprentice with Future1st or call (03) 9656 9797.