There are countless benefits to hiring an apprentice. Many business owners in skilled trades hire apprentices to learn from the more experienced workers and get a job in a well-paying field.
Hiring young, enthusiastic, and talented staff can also be more cost-effective than working with fully trained professionals.
This doesn't mean you can get away with underpaying your apprentices. It's vital to make sure you pay any apprentices you hire correctly for the work they do.
That's why we've put together this guide on everything you need to know about working with apprentices in Canada, including details on their salaries, how their pay works, and any tax implications on apprenticeship pay. So, let's dive into it...
How does apprenticeship pay work?
One of the most important aspects of working with apprentices is making sure they are compensated according to industry regulations.
Apprentices are paid the same as professional employees, who receive pay on a regular basis. If your apprentice is handling a professional workload, they must also be paid professional wages
They must also be provided a training agreement containing information on their on-the-job training and in-class technical training.
This agreement is essentially a contract of employment and must be signed off by both employer and employee at the start of the apprenticeship.
If you provide any classroom-based learning, you don’t have to pay for this portion of their learning. If this is the case, you must state this in the apprenticeship agreement. They can then apply for Employment Insurance (EI) and other forms of financial support while attending their in-school segment of training.
How much do apprenticeships pay in Canada?
Apprentice pay rates in Canada vary between different jurisdictions and industries. As of 2024, the average apprentice salary is $ 43,875 per annum or $22.50 an hour, according to Talent.com.
Their wages also depend on the type of work they will be doing and what level they're at. At the very least, they must be paid the minimum wage of the province they are in:
- Ontario: $16.55 an hour
- British Columbia: $16.75 an hour
- Alberta: $15.00 an hour
Typically, the highest apprentice pay is in Red Seal Trades. Red Seal Trades are designated trades which are governed by Provincial and Territorial Apprenticeship Acts. These trades are used to increase the number of apprentices in Canada by providing a clear set of pay and tax rules.
Who pays apprenticeship wages?
Employers who hire apprentices are responsible for paying apprenticeship wages. But, as a small business owner who may be concerned about whether you can afford to hire an apprentice, there are several grants from the Government to help offset the cost.
An example is the Apprenticeship Incentive Grant (AIG), which is a taxable cash grant of up to $1000 per year, with a maximum of $2000 per eligible person.
The following requirements must be met to qualify for an AIG:
- Must be a Canadian citizen.
- Mustn’t be a high school student.
- Must have the required AIG supporting documents (these vary by province).
- Ensure they have registered as an apprentice in a Red Seal Trade.
- Proof must be provided of at least a year’s apprenticeship in a Red Seal Trade.
Another grant available to employers is the Apprenticeship Completion Grant, which is a taxable cash grant of $2,000 for apprentices who have completed high school and are apprenticing in a Red Seal tTrade.
To qualify for the Apprenticeship Completion Grant, the apprentice must:
- Have gotten their certificate of apprenticeship and certificate of qualification on or after January 1, 2009
- Get their certification in a designated Red Seal Trade
When should an apprentice get a pay raise?
The apprenticeship agreement signed at the start of the employment relationship should detail when pay raises will be made.
The following are reasons why a pay raise may be offered:
- Achieving qualifications.
- Being with the company for a certain amount of time.
- Starting to undertake professional tasks on a more regular basis.
What can an apprentice claim on tax?
One benefit to hiring an apprentice is that both employer and employee have access to tax credits. Apprentices have access to a range of incentives and tax credits while training to become a journeyperson.
Since employers also get tax benefits, it means you'll have more financial support. For example, you can claim up to 10% of wages paid to employees through the Apprentice Job Creation Tax Credit (AJCTC).
They can also claim tax credits via the Tradesperson's Tools deduction, textbook costs, and tuition tax credits.
Who pays for apprenticeship training?
There are a number of grants that further support eligible apprentices funding for their training.
One such grant is the Canada Apprentice Loan, which is an interest-free loan of up to $4,000 per training session in a designated Red Seal trade. Apprentices can use this towards their living expenses to pay for tuition and equipment.
This means you can offer higher quality apprentice job training, leading to an improvement in their skills.
How much paperwork do you need to hire an apprentice?
The paperwork involved in hiring an apprentice is minimal and can be completed in a short time. There are a few forms, evaluations and logbooks that are filled out periodically in a year.
In addition to their training agreement, you'll need to fill out an online apprenticeship training application. If the apprentice is under 18, they must fill out the paper application form and get it signed by their parents or guardians and you as the employer.
How does my business benefit from the apprenticeship program?
There are many benefits to hiring an apprentice in your business. In addition to the grants available, it helps your business prepare the next generation of journeypersons and safeguard its future. Apprenticeships are also a great way to foster employee loyalty, as staff are more likely to be devoted to employers who train and hire them.
Can employers have unlimited trainees on a job site?
Apprentices are usually attached to a professional journeyperson, so you can hire as many as two apprentices per journeyperson in your business.
Get help with paying your apprentices correctly with BrightHR
Paying your staff correctly is extremely important, especially when it comes to apprentices' wages. Whenever they carry out professional tasks, you must pay them professional wages. Failure to pay your staff, whether full-time or trainees, could leave you open to fines and other legal penalties.
As an employer, you already have other aspects of your business demanding your attention. That's why you need expert support to make sure you are conducting your business in line with legal requirements.
BrightHR's suite of software and tools, takes the hassle out of everyday HR admin responsibilities. Our Payroll Navigator tool allows you to save time on your payroll and pay your staff with ease.
Our 24/7 employment relations adviceline BrightAdvice is manned by qualified professionals with over 30 years of Canadian experience available round the clock to answer any questions you may have about working with apprentices.
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