Taking on your first apprentice is one of the biggest steps a small trade business can make. Done well, you get an extra pair of hands, someone trained your way and, in a few years, a qualified tradesperson who knows your customers. Done badly, it's a drain on your time and your cash, and a rough start for a young worker.
This guide explains how apprenticeships work in Australia, what it costs, the government incentives available from 1 July 2026, and the steps to sign up your first apprentice. It's written for sole traders and small trade businesses, and it's current as at November 2026.
What an apprenticeship actually is
An apprentice is an employee who learns a trade while working for you under a training contract. The Fair Work Ombudsman's apprentice entitlements page explains that many of an apprentice's entitlements are the same as any other employee's: annual leave, sick leave, public holidays and breaks under the National Employment Standards, plus whatever their award or agreement says.
Three parties are involved:
- you, the employer, who provides paid work, supervision and on-the-job training,
- the apprentice, who works and studies towards a nationally recognised qualification, and
- a registered training organisation (RTO), often called trade school, which delivers the formal training.
The training contract is registered with your state or territory training authority. Apprentice pay rates depend on having a formal training contract, so get it signed and lodged before the apprentice starts, and check with the Fair Work Ombudsman if you're unsure which rate applies.
Are you ready for an apprentice?
Before you start, be honest about four things.
- Steady work. An apprentice is a long-term commitment, usually three to four years for a trade. You need enough regular work to keep them busy and learning, not just during your busy season.
- Supervision. Apprentices must be supervised by someone qualified in the trade. In licensed trades such as electrical and plumbing, your state regulator also sets supervision rules. Check them before you sign anything.
- Time to teach. For the first year, a new apprentice will slow you down. Budget for jobs taking longer.
- Cash flow. You'll be paying wages, super and workers compensation every pay cycle, and incentive payments arrive later.
If you're not sure, talk to other tradies who've done it. Some businesses start with a group training organisation, which employs the apprentice and hires them out to you, so you don't carry all the obligations yourself.
What it costs
The main costs of employing an apprentice are:
- Wages. Apprentice pay is set by the relevant award, usually as a percentage of the qualified rate that rises each year of the apprenticeship. Adult apprentices (21 or over when they start) often have higher minimum rates. The Fair Work Ombudsman's apprentice pay rates page links to the Pay and Conditions Tool, which calculates the exact rate. Award rates rose by 4.75% from 1 July 2026.
- Trade school time. Time at trade school is paid time and counts as part of the apprentice's ordinary hours.
- Super. 12% super guarantee on their qualifying earnings, paid to their fund within 7 business days of each payday from 1 July 2026. Our guide to super for sole traders explains Payday Super.
- Workers compensation. In most states, employing an apprentice means you need a policy even if your total wages are small. See our guide to workers compensation by state.
- Tools, workwear and PPE, depending on your award and what you agree.
- Your time, supervising and teaching.
Government incentives from 1 July 2026
The Australian Government's Australian Apprenticeships Incentive System focuses support on occupations on the Australian Apprenticeships Priority List, which is updated each January. Housing construction and new energy occupations get the most support.
Australian Government apprenticeship payments for a full-time apprentice, from 1 July 2026
An employer can get up to $5,000 in the first year for a housing construction or new energy apprentice, or up to $2,500 for other Priority List occupations. The apprentice may get up to $10,000 or $2,500.
Show the figures as a table
| Payment | Maximum amount (full-time) |
|---|---|
| Employer: Key Apprenticeship Program Employer Incentive (housing construction or new energy) | $5,000 |
| Employer: Priority Hiring Incentive (other Priority List occupations) | $2,500 |
| Apprentice: Key Apprenticeship Program Apprentice Incentive | $10,000 |
| Apprentice: Australian Apprentice Training Support Payment | $2,500 |
According to the Department of Employment and Workplace Relations factsheet (updated 28 August 2026):
- Key Apprenticeship Program Employer Incentive: up to $5,000 in the first year for an apprentice doing a Certificate III or higher in a housing construction or new energy occupation, paid as $2,000 at 6 months and $3,000 at 12 months (full-time).
- Priority Hiring Incentive: up to $2,500 in the first year for other Priority List occupations at Certificate III or higher, paid as $1,000 at 6 months and $1,500 at 12 months (full-time).
- For the apprentice: the Key Apprenticeship Program Apprentice Incentive of up to $10,000 over the apprenticeship, or the Australian Apprentice Training Support Payment of up to $2,500, depending on the occupation. Apprentices may also be able to get an Australian Apprenticeship Support Loan.
Part-time amounts are half. Payments depend on the apprentice still being in training with you at each claim date, and on eligibility rules that change, so confirm what applies before you count on it. States and territories also run their own programs, such as payroll tax concessions or travel allowances, so ask about those too.
Step by step: signing up your first apprentice
Taking on your first apprentice Illustrative
The steps this guide walks through, in order.
- Check you're readyEnough steady work, a qualified supervisor and time to teach.
- Call an AASN providerFree help with the training contract and incentives.
- Choose an RTOThe trade school that delivers the qualification.
- Sign the training contractRegistered with your state training authority.
- Set up pay and coverAward rates, super, workers compensation, payroll.
- Train and reviewSupervise, sign off progress and plan trade school time.
1. Contact an Australian Apprenticeship Support Network provider
Australian Apprenticeship Support Network (AASN) providers are contracted by the Australian Government to help employers and apprentices. The service is free. Use the find a provider tool on apprenticeships.gov.au. Your provider can check which incentives apply, help you prepare the training contract and lodge the paperwork.
2. Find the right apprentice
Word of mouth, local schools, TAFE and pre-apprenticeship programs are common sources. Look for reliability and attitude as much as skill. Consider a trial day, paid at the correct rate.
3. Choose a registered training organisation
The apprentice and you choose an RTO that delivers the qualification. Agree on how often they'll attend trade school, for example one day a week or block release. This usually goes in the training plan.
4. Sign and register the training contract
You, the apprentice (and a parent or guardian if they're under 18) sign the training contract, and your AASN provider lodges it for registration with the state training authority. There's usually a probation period.
5. Set up payroll and cover
Before the first pay day:
- check the award and the correct apprentice pay rate,
- collect a TFN declaration and their super fund details,
- make sure your workers compensation policy covers them,
- set up Single Touch Payroll reporting to the ATO, and
- give them the Fair Work Information Statement.
6. Train, supervise and review
Plan the first weeks: induction, site safety, and the tasks they'll start on. Keep records of the skills they've learned, because your RTO and training authority will ask you to sign off progress. Check in regularly. Small problems are easier to fix early.
Safety comes first
New and young workers are more likely to be injured at work. Give your apprentice a proper induction, the right PPE, and close supervision on anything risky. If your work includes high risk construction work, such as working at heights or near live electrical services, they must be trained in the safe work method statement before they start. Our guide to SWMS explains what's required.
Tradie Business includes safety forms, including SWMS and job hazard analysis, that your crew can read and sign on their phones, and crew accounts for up to five people so an apprentice can see their jobs and log their hours with timesheets. See pricing for the plans.
Mistakes first-time employers make
- Starting before the paperwork is done. Apprentice rates depend on a formal training contract. Without one, a different (usually higher) rate may apply.
- Not paying for trade school days. Trade school is paid time.
- Treating them as cheap labour. An apprentice who only sweeps the site won't learn, won't stay, and may cost you incentives.
- Missing super deadlines. Payday Super applies to apprentices too.
- Forgetting workers compensation. In NSW and Victoria, for example, employing an apprentice means you need cover even if your total wages are low.
If things don't work out
Sometimes an apprenticeship isn't the right fit. You can't simply end a training contract the way you might end other employment: there are rules about cancelling or transferring it. Talk to your AASN provider and your state training authority before you act, and check the Fair Work Ombudsman's guidance on ending employment.
Where to get help
- apprenticeships.gov.au for AASN providers and the Priority List.
- The Fair Work Ombudsman for pay and conditions, and its guide to taking on an apprentice.
- Your state training authority for training contracts and any state incentives.
Before you hire, make sure your rates cover the extra cost. Our guide to setting your hourly rate shows how.
