Payroll update: Employing Generation Z

Published: Tuesday 3 March 2020

There are many benefits to employing the younger generation; they offer a fresh perspective on things, come with the latest IT skills and a new joiner straight from school or college is unlikely have picked up any bad working habits either.

Studies have shown that over 80% of businesses that employed apprentices found their productivity increased as a result.

Another big plus of employing young people is the cost; the minimum wage for those under 25 is at least 50p less than those over 25.

Employer national insurance is also cheaper for those under 21 and for apprentices under 25 – employers only have to pay 13.8% on earnings over £4,167 rather than over £719.

Age Minimum hourly rate 2019-2020
25 and over £8.21
21 to 24 £7.70
18 to 20 £6.15
School leaver age - 17 £4.35
Apprentice* £3.90

*Under 19 or 19+ and in 1st year of apprenticeship

APPRENTICES

Taking on an apprentice is a great way to employ someone new, for very little cost, whilst they study to gain skills specifically for that job role.  Apprenticeships must last at least a year and the training course they enrol on should be with a local college or professional training provider.

The government provides funding to help towards apprenticeship training costs.

If you pay the Apprenticeship Levy (as an employer with a pay bill of over £3 million a year), then you’ll receive funds to spend on training and assessing your apprentices, to which the government will add 10%.

If you don’t have to pay the Apprenticeship Levy, you will pay 5% towards the training costs and the government will pay the rest up to a prescribed limit.

EMPLOYING UNDER 18s

There are extra practicalities to consider, for example, children can only start full-time work once they’ve reached the minimum school leaving age. In England, a young person must be in part-time education or training (including apprenticeships) until they’re 18. There are restrictions on when and where children are allowed to work.

Children are not allowed to work:

  • places like a factory or industrial site
  • during school hours
  • before 7 am or after 7 pm
  • for more than one hour before school (unless local bylaws allow it)
  • for more than four hours without taking a break of at least one hour
  • in most jobs in pubs and betting shops and those prohibited in local bylaws
  • in any work that may be harmful to their health, well-being or education, or
  • without having a two-week break from any work during the school holidays in each calendar year.

They may also need an employment permit if local bylaws require it and there may be other restrictions – check with your local council’s education department.

There are also special rules which only apply during term times and school holiday times.

During term time children can only work a maximum of twelve hours a week. This includes:

  • a maximum of two hours on school days and Sundays; and
  • a maximum of five hours on Saturdays for 13 to 14-year-olds, or eight hours for 15 to 16-year-olds.

During school holidays 13 to 14-year-olds are only allowed to work a maximum of twenty-five hours a week. This includes:

  • a maximum of five hours on weekdays and Saturdays; and
  • a maximum of two hours on Sunday.

During school holidays 15 to 16-year-olds can only work a maximum of thirty-five hours a week. This includes:

  • a maximum of eight hours on weekdays and Saturdays; and
  • a maximum of two hours on Sunday.

Employing Generation Z can have great benefits for your business, but make sure you understand how this should work in practice first. For more information on having generation Z on your payroll, contact the team below.

Content image: /uploads/team/unknown.jpg Cheryl Baker
Cheryl Baker
Director, Payroll Solutions
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