Why Should Companies Opt for NAPS or NATS Scheme and Hire Apprentices?

Apprenticeship is one of the most promising and efficient ways of nurturing talent and developing skilled manpower for the country. It provides the much-needed window to consolidate disorganized ways of working and better match job aspirations with the outcome of skill development. If implemented strategically, it may transform the chaotic informal sector through mutual benefits for the employer, employee and training organizations.

What are NAPS and NATS?

National Apprenticeship Promotion Scheme (NAPS), launched by the Ministry of Skill Development and Entrepreneurship (MSDE) proactively creates and increases skilled manpower in India. The apprenticeship program comprises basic, on-the-job training at the workplace and can range from a period of 6 months to 3 years, depending on the program they take up. NAPS was introduced with a vision to provide apprenticeship training for over 50 lakh youngsters, increasing the apprentices’ engagement in the Micro, small and medium enterprises (MSME) segment to build productivity.

National Apprenticeship Training Scheme (NATS), launched by the Ministry of Human Resource Department (MHRD), is a one-year programme equipping technically qualified youth with the practical knowledge and skills required in their field of work. The main objective of NATS is to facilitate Fresh Graduates and Diploma Holders in Engineering/ Technology/ Architecture/ Pharmacy/ Hotel Management & Catering Technology, and (10+2) level Vocational courses Pass outs to acquire ‘job’ training in Industries/ Establishments and thus to make them more employable.

Why should companies undertake the NAPS/NATS programs?

Registered employers under the Apprentices Act, of 1961 are exempt from contributing to Employees State Insurance (ESI) and Employees Provident Fund (EPF) for the apprentices engaged by them. Other than that, the Government of India provides financial support for employers undertaking the NAPS/NATS program. One of the most significant advantages is its end-to-end service for employers via third-party administrators (TPA), as the loyalty element in apprentices is higher, leading to reduced attrition.

Organizations that hire apprentices have a greater retention rate than hiring fresh candidates under contract, as candidates look forward to the Government certification, they obtain at the end of the training program.

Employers can undertake either the NATS/NAPS program, depending on skill requirements/ candidate qualification/other factors based on their business needs.

To choose the right program for your business needs, take a look at the table below and understand the difference between NAPS and NATS-

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.  

Cost Containment

Apart from the ease of training young people through the apprenticeship program, they cost less than candidates recruited under the minimum wage guidelines set by the government, making the entire service contract more affordable for employers and enabling them to recruit candidates at one price point irrespective of the state.

Industry focussed skills are addressed

The apprenticeship program integrates industry and skill-based training resulting in companies enjoying the benefits of talent that is job-ready from day one, post-training. They have the scope to produce better candidates because there is an element of soft skills attached to it, and the programs have been designed with input from the industry.

 Benefits of undertaking the NAPS/NATS Scheme

• Employers are exempt from EPF and ESI contribution
• On-the-job training creates a proactive workforce benefitting 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 utilised 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.

Why should employers be looking at apprenticeships?

• Tailored training provided, as per business needs

The content of the apprenticeship training is set by the employer, who decides which skills their ideal employee needs. Suppose a new graduate lacks technical skills, and you have a vacancy to fill, engaging in an apprenticeship is a good option.

• One way to upskill current employees

A maximum number of apprentices are usually above the age of 19 and are likely to have been in apprenticeships with their current employer.

How can this help? In your current workforce, there may be an employee who can benefit from an MBA to fast-track his managerial skills or maybe one of your employees is exceptionally talented but lacks technical skills, and can be upskilled by an apprenticeship, instead of formal educational training.

• Apprenticeships costs are taken care of

Under the NAPS scheme, the government provides employers with financial assistance. Apprenticeship with a basic training amount of up to Rs 7500 per apprentice for a maximum of 500 hours is reimbursed by the Government of India.

Under the NATS scheme, apprentices connected with the technical field are liable to earn around Rs.8000 per month, while the graduates would be earning Rs.9000 per month during their training year.

• Soft skill shortages addressed

Graduates are often technically sound but lack the skills to work in a daily work environment. Skills like negotiation, up management, business communication, and commercial awareness are essential to keep up in a traditional workplace. Apprentices develop these skills as they work and learn simultaneously in a working environment.

• Can free up senior staff

Low-level tasks are a part of daily work in a business environment but are also something that has to be taken care of. An apprentice can handle these tasks and free up the senior staff allowing them to focus on more critical business operations.

• To get a fresh perspective from the younger generation

Employers are aware of the value of diversity in the workplace and the many benefits it offers to better the productivity of an organization. At times, apprentices can offer a fresh perspective and insight into clientele behaviour, especially if the client is from the youngster generation.

It is evident that the NAPS/NATS program is beneficial for the future of Indian industrial sectors, and can help boost the economic growth of our Country.

Alp as you NAPS/NATS Service Provider

As an authorized Third-Party Aggregator (TPA) for both NATS and NAPS, Alp facilitates employers concerning submission of reimbursement claims, apprenticeship contracts; and various other formalities to be adhered under the apprenticeship program.

Alp Consulting has always encouraged employers to get eminently involved in mobilizing employment in India.

In the journey of contributing towards government schemes, our clients have benefitted and have been equipped with a potential workforce to suit the exact requirement of their organizations. Alp Consulting also gives access to a large pool of talent and future workforce along with consistent assistance through each step of implementation of the National Apprenticeship Programme Scheme.

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