Making payments to industry placement students

T Level students complete a substantial industry placement as part of their qualification. The placement gives students high-quality experience in a real workplace, but it is not employment. 

There is no legal requirement or expectation to pay industry placement students. The placement forms part of their course rather than a job, and students are not classed as employees. 

However, some employers choose to offer payments or other forms of support. This can help students cover costs such as travel or meals and make placements more accessible. 

The facts: 

• You are not obliged to pay a wage or allowance. 
• Offering a payment does not automatically make the student an employee, as long as the purpose is educational and the placement is arranged through a T Level provider. 
• If you do pay a wage, normal tax and National Insurance rules apply. 
• If in doubt, ask your provider or check HMRC employment status guidance for reassurance. 

Payment options you may wish to consider 

Your provider can advise what other employers in your sector offer and help you decide what’s appropriate. 
Below are examples of payments and rewards you might consider, with their purposes and key points. 

Wage 

• Motivates students to work hard and perform well. 
• Recognises the contribution they make to your business. 
• Differentiates students from volunteers and can enhance your reputation as a good employer. 
• Note: wages are subject to tax and National Insurance. 

Wage for students already on your payroll 

• If a student already works for you part-time, their existing hours may count towards their placement if they’re occupationally relevant. 
• There’s usually no need to change their employment terms and conditions, but your provider can advise if adjustments are required. 

Bonus or reward 

• A bonus for meeting agreed milestones can boost morale and encourage achievement. 
• Could be a cash payment or voucher. 
• Agree and document the criteria in advance to avoid misunderstanding. 

Allowance or reimbursement 

• Covers costs such as travel, meals, or equipment so that students are not out of pocket. 
• Helps ensure placements are accessible to all, regardless of background. 
• Allowances typically do not affect family benefits. 

Non-financial recognition 

• Shows appreciation and builds confidence through recognition rather than cash. 
• Examples include a written reference, mention in newsletters, or a certificate highlighting the student’s achievements. 

Good practice 

• Discuss arrangements early with your T Level school or college before the placement starts. 
• Be consistent in how you treat all students. 
• Keep simple written records of any payments, allowances or rewards. 
• Clarify practicalities - such as how and when allowances are paid or claimed. 

Support available 

Some T Level schools and colleges can access the T Level Employer Support Fund to help employers cover costs such as equipment, additional supervision or adjustments for students with SEND. Your provider can tell you whether this applies.