Statutory Instrument 2001 No. 1121

The Industrial Training Levy (Engineering Construction Board) Order 2001

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STATUTORY INSTRUMENTS

2001 No. 1121
EMPLOYMENT AND TRAINING
The Industrial Training Levy (Engineering Construction Board) Order 2001

	Made	12th March 2001
	Coming into force	19th March 2001

Whereas the Engineering Construction Industry Training Board has submitted proposals for the raising and collection of a levy under section 11(1) of the Industrial Training Act 1982[1] ("the 1982 Act");

     And whereas in pursuance of section 11(3) of the 1982 Act the said proposals include provision for the exemption from the levy of employers who, in view of the small number of their employees, ought in the opinion of the Secretary of State to be exempted from it;

     And whereas the proposals are made in pursuance of section 11(4)(b) of the 1982 Act and the Secretary of State is satisfied that those proposals fall within section 11(5)(b) of the said Act ("the relevant proposals") and that they are necessary as mentioned in the said section 11(5), and that the condition mentioned in section 11(6)(a) of the 1982 Act is satisfied in the case of the relevant proposals;

     And whereas the Secretary of State estimates that the amount which will be payable by virtue of the following Order by certain employers in the engineering construction industry will exceed an amount which he estimates as equal to one per cent. of relevant emoluments, but considers such amount appropriate in the circumstances, and the following Order therefore falls within section 11(7)(b) of the 1982 Act;

     And whereas the Secretary of State has consulted the Scottish Ministers pursuant to section 88(2) of the Scotland Act 1998[2];

     And whereas a draft of the following Order was laid before Parliament in accordance with section 12(6) of the 1982 Act and approved by resolution of each House of Parliament;

     Now, therefore, the Secretary of State, in exercise of the powers conferred by sections 11(2), 12(2), (3) and (4) of the 1982 Act and of all other powers enabling him in that behalf, hereby makes the following Order:

Citation and commencement
     1. This Order may be cited as the Industrial Training Levy (Engineering Construction Board) Order 2001 and shall come into force on the seventh day after the day on which it is made.

Interpretation
     2. - (1) In this Order unless the context otherwise requires:

(a) "assessment" means an assessment of an employer to the levy;

(b) "the base period" means the period of twelve months that commenced on 6th April 2000;

(c) "the Board" means the Engineering Construction Industry Training Board[

    (2) Any reference in this Order to an establishment that commences to carry on business or that ceases to carry on business shall not be taken to apply where the location of the establishment is changed but its business is continued wholly or mainly at or from the new location, or where the suspension of activities is of a temporary or seasonal nature.

    (3) For the purposes of this Order in the case of an establishment that is taken over (whether directly or indirectly) by an employer in succession to, or jointly with, another person, the person or persons carrying on the establishment on the day upon which this Order comes into force shall be treated as the employer of any person who was employed at any time in the base period at or from the establishment under a contract of service or of apprenticeship or under a labour-only agreement and that employer shall be assessed to levy in accordance with article 4 below.

    (4) This Order applies to the activities of the engineering construction industry in so far as they are carried out in Great Britain or in so far as they are carried out in relation to employment to which the Employment Protection (Offshore Employment) Order 1976[6] applies.

Meaning of "leviable establishment"
     3. - (1) For the purposes of this Order "leviable establishment" means, subject to paragraph (3) below -

(a) an establishment engaged during the necessary period wholly or mainly in the engineering construction industry; and

(b) an establishment (not falling within sub-paragraph (a)) at or from which persons were employed during the necessary period in any activities such as are mentioned in paragraph 1(c) of the Schedule to the industrial training order ((but subject to paragraph 2 of that Schedule) (related and administrative etc. activities).

(2) In this article "the necessary period" means -

(a) unless sub-paragraph (b) applies, a period (which need not be continuous) consisting of a total of 27 or more weeks falling within the base period; or

(b) in the case of an establishment that started to carry on business in the base period, a period (which need not be continuous) falling within the base period consisting of a total number of weeks exceeding one half of the number of weeks in the part of the base period starting on the day on which business was commenced and ending on the last day of the base period.

(3) An establishment in respect of which -

(a) the sum of the emoluments and net labour-only payments referred to in article 5(1)(a) below does not exceed Ł75,000; and

(b) the sum of the emoluments and net labour-only payments referred to in article 5(1)(b) below does not exceed Ł1,000,000

is not, however, a leviable establishment.

Imposition of levy
     4. - (1) The levy to be imposed by the Board on employers in respect of the levy period shall be assessed in accordance with the provisions of this article.

    (2) The levy shall be assessed by the Board separately in respect of each establishment of an employer, but in agreement with the employer one assessment may be made in respect of any number of such establishments, in which case those establishments shall be treated for the purposes of that assessment as constituting one establishment.

    (3) Subject to the provisions of paragraph (5) below the levy on each employer shall be assessed by the Board in respect of the emoluments and net labour-only payments paid by him to all persons specified in paragraph (4) below employed by the employer in the base period at leviable establishments of his and the amount of the levy shall be as specified in article 5 below.

    (4) The persons referred to in paragraph (3) are,

(a) in the case of an establishment such as is mentioned in article 3(1)(a), all persons employed at or from the establishment except -

(i) any person undergoing a course of training as a seagoing officer or rating under an agreement in writing with an employer in the shipping industry, or with any organisation of employers in that industry or with any association of such organisations,

(ii) any person engaged wholly in agriculture (within the meaning of section 109(3) of the Agriculture Act 1947[

(b) in the case of an establishment such as is mentioned in article 3(1)(b), all persons employed at or from the establishment wholly or mainly in any of the activities such as are mentioned in paragraph 1(c) of the Schedule to the industrial training order

and for the purposes of this paragraph a company director remunerated solely by fees shall be left out of account but otherwise a company director (including a person occupying a position of director by whatever name he is called) shall be treated as employed.

(5) A charity within the meaning of section 506 of the Income and Corporation Taxes Act 1988 shall be exempted from the levy.

Amount of the levy
5. - (1) The levy assessed in respect of any leviable establishment shall be the aggregate of -

(a) an amount equal to 1.5 per cent. of the sum of -

where that sum exceeds Ł75,000; and

(b) an amount equal to 0.18 per cent. of the sum of -

where that sum exceeds Ł1,000,000.

(2) For the purposes of paragraph (1) above the net labour-only payments made in the base period is the difference between labour-only payments and labour-only receipts during that period (and where labour-only receipts exceed labour-only payments the net labour-only payments shall be zero) and for the purposes of this paragraph -

(a) "labour-only payments" in any period means the sum which (rounded down where necessary to the nearest Ł1) represents all payments (including payments for the incidental use of tools) made by the employer during the period under labour-only agreements for services rendered to him in his trade or business carried out at or from the establishment; and

(b) "labour-only receipts" in any period means the sum which (rounded down where necessary to the nearest Ł1) represents all payments (including payments for the incidental use of tools) received by the employer during the period under labour-only agreements for services rendered by him or on his behalf in his trade or business carried out at or from the establishment.

Assessment notices
     6. - (1) The Board shall serve an assessment notice on every employer assessed to the levy, but one notice may comprise two or more assessments.

    (2) The amount of any assessment payment under an assessment notice shall be rounded down to the nearest Ł1.

    (3) An assessment notice shall state the amount of the levy payable by the person assessed to the levy, and that amount shall be equal to the total amount of the levy assessed by the Board under the provisions of this Order in respect of each establishment included in the notice.

    (4) An assessment notice shall state the Board's address for the service of a notice of appeal or of an application for an extension of time for appealing.

    (5) An assessment notice may be served on the person assessed to the levy either by delivering it to him personally or by leaving it, or sending it to him by post, at his last known address or place of business in the United Kingdom, or if that person is a corporation, by leaving it, or sending it by post to the corporation, at such address or place of business or at its registered or principal office.

Payment of the levy
     7. - (1) Subject to the following provisions of this Order, the amount of each assessment appearing in an assessment notice served by the Board (the date of which shall not be earlier than 31st August 2001) shall be due and payable by the employer to the Board one month after the date of the notice.

    (2) The amount of an assessment shall not be recoverable by the Board until there has expired the time for appealing against the assessment allowed by article 9(1) below and any further period or periods of time that the Board or an employment tribunal may have allowed for appealing under article 9(2) or (3) or where an appeal is brought, until the appeal is decided or withdrawn.

Withdrawal of assessment
     8. - (1) The Board may, by a notice served on the person assessed to the levy in the same manner as an assessment notice, withdraw an assessment if that person has appealed against that assessment under the provisions of article 9 below and the appeal has not been entered in the Register of Appeals kept under the appropriate regulations specified in article 9(4).

    (2) The withdrawal of an assessment shall be without prejudice -