There are many benefits to hiring an apprentice. You can hire young, enthusiastic, and talented staff who are more cost effective than other employees.
But you need to make sure you pay any apprentices you hire correctly for the work they do.
In this guide, we’ll discuss apprentice salary in Canada, how their pay works, as well as any tax implications on apprenticeship pay.
How does apprenticeship pay work?
Apprenticeship pay works the same as professional employees, where they receive pay on a regular basis.
You must be aware that if an apprentice is asked to handle a professional workload, they must be paid professional wages.
If you provide any classroom-based learning, you don’t have to provide payment. If this is the case, you must state this in the apprenticeship agreement.
This agreement is essentially a contract of employment and must be signed off by both employer and employee at the start of the apprenticeship.
How much do apprenticeships pay in Canada?
Apprentice pay rates in Canada vary between different industries. In 2021, the average apprentice salary is $39,000 or $20 an hour. Typically, the highest apprentice pay is in Red Seal Trades.
The wage depends on the type of work they will be undertaking, but it must be at least the minimum wage:
Ontario: $14.35 an hour. British Columbia: $15.20 an hour. Alberta: $15.00 an hour.
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?
Apprenticeship wages are paid to the employee by the employer. But you can receive apprenticeship grants from the Government.
The Apprenticeship Incentive Grant (AIG) 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.
When should an apprentice get a pay rise?
In the agreement signed at the start of the apprenticeship, it must be stated how pay rises will take effect.
The following are reasons when a pay rise 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, both employer and employee have access to tax credits. This means there is further support for the hiring of apprentices. Through the Apprentice Job Creation Tax Credit (AJCTC), employers can claim back up to 10% of wages paid to apprentices.
Apprentice tradespersons can also claim back the cost of the tools if eligible as per the Government website.
Who pays for apprenticeship training?
There is also further support in which your apprentices could qualify for to help fund any job training. The Canada Apprentice Loan is an interest free loan up to $4000, which go towards any technical training you offer.
This means you can offer higher quality apprentice job training, leading to an improvement in their skills.
Get help with paying your apprentices correctly today with BrightHR
Paying your staff correctly is extremely important, especially apprentices. Whenever they carry out professional tasks, you must pay them professional wages.
BrightHR has a tools that can help you pay your staff. Our Payroll Navigator tool allows you to save time on your payroll and pay your staff with ease.
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