Advice and Instructions

Existing Worker Trainee - Definition

Issued: 21 December 2001

This advice concerns the status of a person who continues to work in an enterprise after the ownership of the enterprise has changed hands and the new owner (employer) seeks to establish a traineeship for that person.

The following definitions apply for the purposes of the NSW approval requirements for the establishment of traineeships:

New Entrant Trainee is defined as a person employed within an enterprise for not more than three months full-time or 12 months part-time or casual or any combination of the above for a continuous period not exceeding 12 months.

Note: Such persons must not have been employed at all by the applicant employer for at least six months prior to such full-time employment and twelve months prior to such part-time or casual employment.

Existing Worker Trainee is defined as a person who has been employed within an enterprise continuously for more than 3 months full-time or 12 months casual or part-time or a combination of both, immediately prior to commencement of the training contract.

Note: For the purposes of the NSW approval requirements, an enterprise includes government.

The Industrial Relations Act 1996, Part 8 - Protection of Entitlements on Transfer of Business, defines the meaning of the transfer of business and a transferred employee. These definitions assist in the clarification of whether a person is a new employee:

The transfer of business means the transfer, transmission, conveyance, assignment or succession, whether by agreement or by operation of law, of the whole or any part of a business, undertaking or establishment.

A transferred employee means a person who becomes an employee of an employer (the new employer) as a result of the transfer of business to that employer from another employer (the former employer).

A critical factor in determining the status of a person as a New Entrant or Existing Worker trainee is whether that person has secured the carriage of any employment entitlements/benefits from their previous employment to their present employment.

For example, an employee, terminated by the existing employer prior to the transfer of the business, who is paid all termination entitlements and does not carry long service or sick leave accruals or entitlements, is generally a new entrant trainee with respect to the new employer.

Conversely, a person who continues employment in an enterprise after it has changed hands, without loss of entitlement and/or benefit, would generally be an existing worker trainee.

Carriage of benefit
An example of carriage of benefit is where an employee commences employment with the new employer and, by agreement established in the business transfer arrangements, retains accrued employment entitlements such as sick leave or recreation leave from service with the previous employer.

Where a business changes hands, the retention of entitlements by an employee from the previous contract of employment in the new employment arrangements, would be a significant indicator that there has not been a break in employment arrangements.

Given the potential number of variables that may be taken into account in assessing whether a ‘transferred employee’ is a New Entrant Trainee or an Existing Worker Trainee each such arrangement will be considered on its merits. The above criteria should be applied in assessing applications to establish a New Entrant Traineeship where a change of employment is a consideration.