Could the Kickstart Scheme help your business?

As 220,000 jobs were lost between April and June and another 80,000 jobs were lost between May and July, the Government has been pressured to put further measures in places to better protect UK workers. In response to this, in July, Chancellor Rishi Sunak announced the Government’s £2bn Kickstart Scheme which will subsidise six-month work placements for young people on Universal Credit aged between 16 and 24.

How it works

Employers are being encouraged to take on young people at risk of long-term unemployment for these 6-month placements with a minimum of 25-hours a week paid. Any businesses taking part will be paid 100% of the employee’s wage directly including National Insurance and mandatory Pension contributions. This will reflect the current minimum wage in the UK. 

Employers will not be required to take on employees further than the 6-month period, although you may choose to do so if all is going well. The aim of this placement is to give young people an opportunity to develop their skills and expand on their CV for the future so you will be expected to offer training and valuable work experience – helping them to build transferrable skills where possible.

You will need to prove that the placements you are making available to applicants are new and not replacing any existing jobs as the Government want to avoid companies making other employees redundant for the option of ‘free labour’.

Will all businesses be eligible?

You can check whether your business is eligible and apply for the Kickstart Scheme here.

What are the drawbacks?

While many employers are likely to have great experiences with their placements, there is always the risk that the individual will not be suited to your business. This scheme is designed for young people who are relatively new to the professional workforce which means they will need more guidance than other more experienced workers. Due to this, you should take into account whether you have the time and support network available to fully mentor a potential placement and ensure that you both get the most out of the time.

What if I want to terminate the placement early?

At the moment, there is no official guidance on what the process would be for ending placements early. But it seems fair to assume that if you are experiencing difficulties that cannot be rectified, this will be an option.

Will the Kickstart Scheme affect my insurance?

It’s likely you will need to have sufficient Employers Liability Insurance in place to cover for your employee. If you decide to take part in the scheme, just give your broker or insurer a ring to check that you have the right cover in place.