Feature
Making the most of the Apprenticeship Levy
After so many indicators around the food industry workforce pointing in the wrong direction, the government’s announcement at the end of November of a Sector Council, with skills as a key area of concern, came as welcome (though not totally unexpected) news.
“We’ve been working very closely with DEFRA [the Department for Environment, Food and Rural Affairs] on proposals relating to exports, skills and innovation,” says Food and Drink Federation (FDF) policy manager on industrial strategy, skills and employment Selga Speakman-Havard.
“Our skills proposal has been looking at four main challenges: the geographical spread of the industry; its image; the technical skills shortage and the low numbers of apprenticeships.”
Part of any ‘deal’ will be an industry undertaking to follow through on current targets to increase the proportion of the workforce in apprenticeships from 1% to 3% – originally set for 2020.
In this context, the introduction of the Apprenticeship Levy in April 2017, which applies to companies with a wage bill of £3M or more at a rate of 0.5% of this total, appears to have created as many challenges as it has opportunities.
At the National Skills Academy for Food & Drink (NSAFD), the upbeat tone of chief executive Justine Fosh as she discusses the Levy is in sharp contrast with her wariness ahead of its introduction.
Understandably, given the precedents, there were concerns that the new government-run IT infrastructure would simply not operate properly. Those concerns, for now, seem to have been allayed.
“Historically, a lot of disparate training activity took place at a site level,” she says. “But we’ve certainly seen many food businesses establish company-wide programmes that seek to address their skills shortages across their entire businesses.”
Growing pains (back to top)
This keenness to embrace the Levy has not been universal. The impending change from one system to another appears to have triggered a rush to set up apprenticeships before the April 2017 deadline.
Of overall uptake since the Levy’s introduction, Fosh says: “We thought companies would be quicker off the mark, but it’s taken time for a whole new system to embed.”
The NSAFD identifies other reasons for delay. “Five years ago, a company might not have known how many apprentices it had across its business,” says Fosh.
“The system used to operate largely under the radar. Now, when [the Levy sum] is returned via the digital account, it is actually government funding. The guidance for appropriate use of this money is significant, as are the implications of misusing it.”
She talks about the risks to businesses associated with delivery being “phenomenal”. Both food businesses and providers have been seeking to mitigate those risks to their respective organisations.
“Getting to a satisfactory conclusion has taken a lot of time and, in some instances, a lot of lawyer hours!” says Fosh.
There would be financial as well as reputational impacts for a company deemed to have brought apprenticeships into disrepute, for example. “For a minor breach, a company may be stopped from accessing its Levy pot,” says Fosh. “For a major breach, the government can actually claw money back from the bottom line.”
If a company can overcome these challenges, the opportunities can be significant. Just over a year ago, Nicky Taylor stepped into the role of head of learning and development at Tulip, which is owned by Danish Crown. It comprises 16 UK sites and employs around 7,000 workers.
“There are exciting things happening in our apprenticeship and graduate programmes, but also in coaching and mentoring skills,” she says. “We’re really starting to use those skills with new – but also with existing – people in the company.”
But for manufacturers, the issue of skills and training is not about hitting arbitrary quotas. Taylor states: “There’s a degree of uncertainty around recruitment.”
As companies pick a path through pre-Brexit no man’s land, this is a challenge across workforces as a whole. But it is being felt acutely in specific skill areas.
“There are certain core skills that are incredibly difficult to bring into the business,” she says. “How do you ensure you have that right pipeline of talent? We’re having to make predictions about who we need to bring in now in order to make sure we have the right people in four years’ time.”
Like other food manufacturers, Tulip is keen to foster engineering and technical skills, in particular. But for this meat-based company, butchery skills are also critical. “These areas are really important for us,” says Taylor. “It’s about being able to run our business well.”
For Tulip, apprenticeships are already playing a more important role in bringing talent into the company. Taylor reports that, after starting 29 apprenticeship places in 2015 and again in 2016, the company boosted this to 47 starts during 2017. “We have plans to grow our numbers again in September 2018,” she says.
‘Learning experience’ (back to top)
Tulip is building what it hopes will become a “fantastic learning experience”, says Taylor. This includes team-building exercises, masterclasses with the company’s engineers, apprentice swaps between Tulip and its machinery suppliers, and company-wide apprentice conferences with their own awards ceremonies.
“In conjunction with City & Guilds, we’ve also put in place an ambassadors’ programme, where our apprentices present to children in schools in their own communities,” says Taylor.
“They’re so excited about that! As a business, we have a duty to tell young people that apprenticeships are a great way to start your career. There are still a lot of misconceptions around them and what they can offer.”
As the FDF makes clear, the image of the industry is one of the issues that needs to be addressed most urgently – and that image starts with school-age children.
Meanwhile, as part of its engineering apprenticeship scheme, Tulip blocks in six-week periods for each group at a Birmingham college, and provides its own accommodation.
Other firms might recognise the value of this type of arrangement, while being deterred by accommodation costs. This can be a big issue for all but the largest companies, says the FDF.
Speakman-Havard explains: “An ‘allowable expenses’ regime [under the Levy] would permit companies to recover the cost of valuable staff time, travel and accommodation [as well as capital investment needed for ‘on-the-job’ training] that currently sit outside the Levy.
“As things stand, these extra expenses act as barriers to recruiting more apprentices, especially for medium-sized businesses.”
Beyond apprenticeships (back to top)
Of course, strategies for recruiting the right people and developing skills go well beyond apprenticeships. The new Sector Council, for example, will also be looking at ways of identifying and nurturing future industry leaders.
At Tulip, Taylor explains that coaching and mentoring are currently applied in the main to new recruits, typically at apprentice level as a part of their induction, but also at director level, where they focus on performance. “The next stage, during 2018, will be to get behind leadership development,” she says.
Naturally enough, the graduate part of the recruitment puzzle is important for Tulip, too. “Currently, we take on graduates straight after they complete university with a wraparound two-year development programme,” says Taylor.
“This involves spending time at all our sites, leadership development, senior mentors, and so on. We’re also keen to start looking at degree-level apprenticeships.”
At the opposite end of the spectrum, compliance training can be just as important to the day-to-day running of an organisation as leadership development.
At William Reed online provider Appetite Learning, the emphasis is on compliance training for food factory and catering staff, taking them up to level 2 food safety and hygiene.
Potentially, learners can progress to level 3 online, but levels 4 and 5 are taught in a face-to-face setting, says Alex Bebbington, commercial director at Appetite Learning.
“Our focus is on blended learning,” she explains. “Online, you can get everyone to a base level. But with something like manual-handling training, the online component might be followed by a session with a face-to-face trainer.”
As Bebbington says, in a large company, e-learning can be more cost-effective in ensuring the whole workforce is compliant.
On the other hand, given that most workplace regulation is based on EU standards, this is one area that is being disproportionately affected by Brexit and a wait-and-see attitude by food firms, she adds.
