Corporate Social Responsibility (“CSR”) spending for National Apprenticeship Promotion Scheme (“NAPS”)/ National Apprenticeship Training Scheme (“NATS”) and Flexi- MoU Scheme.

Note on Corporate Social Responsibility (“CSR”) spending for National Apprenticeship Promotion Scheme (“NAPS”)/ National Apprenticeship Training Scheme (“NATS”) and Flexi-MoU Scheme.

• Introduction:

Apprenticeship Training is a course of training in any industry or establishment, undergone in pursuance of a contract of apprenticeship between employer and apprentices and under prescribed terms and conditions.

National Apprenticeship Promotion Scheme (“NAPS”) & National Apprenticeship Training Scheme (“NATS”) aims to promote apprenticeship training in the country, by providing partial stipend support to the apprentices engaged under the Apprentice Act, 1961, undertaking capacity building of the apprenticeship ecosystem, and providing advocacy assistance to the stakeholders.

• Objectives:
• To promote apprenticeship training in the country.
• To provide financial support to establishments to undertake apprenticeship programs in the following ways: –
  1. To support establishments, (especially MSMEs) to engage apprentices under the Apprentices Act and pay stipend to them as per prescribed rates wherein under NAPS 25% of prescribed stipend subject to a maximum of Rs. 1500/- per month per apprentice is reimbursed to such establishments by the Government of India to engage apprentices.

1. ii) To support the establishments, (especially MSMEs) per apprentice for a maximum of 500 hours is reimbursed to them (to be calculated @ Rs. 15/hour) /or to the Basic Training Provider engaged by them under NAPS by the Government of India.

• Salient Features:

• National Apprenticeship Promotion Scheme (NAPS), launched by the Ministry of Skill Development and Entrepreneurship (MSDE).
• National Apprenticeship Training Scheme (NATS), launched by the Ministry of Human Resource Department (MHRD).
• Designated Trades (DT): Designated Trade means any trade or occupation or any subject field in engineering or non-engineering or technology or any vocational course which the Central Government, after consultation with the Central Apprenticeship Council (CAC), may, notify in the Gazette.
• Optional Trades (OT): Optional Trade means any trade or occupation or any subject field in engineering or non-engineering or technology or any vocational course as may be determined by the employer.
• Registered employers under the Apprentices Act, of 1961 are exempt from contributing to Employees State Insurance (ESI) and Employees Provident Fund (EPF).
• The stipend reimbursement amounts to 25% of prescribed stipend or to Rs.1500/month (per candidate) whichever is lower.
• The GoI provides financial support for employers undertaking the NAPS/NATS program.
• The Apprenticeship Program in India is implemented by the Ministry of Skill Development and Entrepreneurship (“MSDE”) at the National level. The MSDE has entrusted the Directorate General of Training (“DGT”).
• Band for apprenticeship engagement revised to 2.5%-15%. Additionally, 5% reserved for Fresher apprentices.
• Organizations that hire apprentices have a greater retention rate than hiring fresh candidates under contract.
• Employers can undertake either NATS/NAPS program, depending on skill requirements/ candidate qualification/other factors based on their business needs.
• Companies engaged with apprentices can also opt for ‘skill training’ from their CSR funds to demand under the Apprentices Act, and the expenses incurred during the training can be claimed as CSR expenses.  
• Implementing Agencies

Apprenticeship Training is a course of training in an industry or establishment, under contract of apprenticeship which consists of Basic Training component and on the job training (OJT) /practical training

• The Regional Directorates of Skill Development and Entrepreneurship (RDSDEs) under the control of Directorate General of Training (DGT) are the implementing agencies in their respective states/ regions in respect of all “Designated Trades”.
• National Skill Development Corporation (NSDC) and CEOs of the Sector Skill Councils (SSC) under the control of NSDC are the implementing agencies in their sectors in respect of “Optional Trades”.
• Eligibility to avail benefits
  The minimum age for an apprentice is Fourteen (14) years, and Eighteen (18) years for designated trades related to hazardous industries, as per Section 3(a) of the Apprentices Act, 1961.
• Apprenticeship training is primarily a transition from academia to workplace, and therefore, to avail partial stipend support by the Government, at the time of registration the upper age limit should be Thirty-five (35) years.
• Different Apprenticeship Scheme & Rules:

• Benefits For Organizations:
• Employers are exempt from Employee Provident Fund (EPF) and Employee State Insurance (ESI) contribution
• On-the-job training creates a proactive workforce benefiting the employers in the long run as the trainees prove to be assets to the organization.
• Reduces costs on recruitment process since the apprentices are up skilled in a short period and start contributing productively.
• On completion of training, based on the performance of the apprentices, the employers are allowed the flexibility to retain or let go of the employees.
• CSR funds can be utilized to engage candidates in skill training under the Apprentices Act.
• Skill gap shortage addressed efficiently by providing on-the-job training to candidates, specific to the business needs.
• The reduced attrition rate, as there is a higher loyalty factor among apprentices
• Further provisions offered in regard to the submission of returns, other information and contract of apprenticeship through the apprenticeship portal, for time-bound approval.
• Help build brand recognition, as the primary objective of the NAPS program was to enforce apprenticeships and promote employment opportunities for the youth.

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