A traditional contract of apprenticeship usually states that it will run for a specified time or until the apprentice reaches a certain standard. The contract then ends automatically when that period ends or the standard is reached. The company is entitled to terminate the contract early only in certain very limited circumstances. These are where the apprentice has been guilty of such serious misconduct or has become so seriously incapacitated that it is impossible for the company to teach the apprentice, or the business has closed or fundamentally changed in nature, making it impossible to train the apprentice in the skills set out in the contract.
If a traditional apprentice's contract is terminated prematurely in breach of contract, the apprentice is entitled to compensation, or 'damages', reflecting not only his or her lost wages for the balance of the apprenticeship but also the value of his or her lost training and the reduction in his or her future employment prospects. This compensation could be substantial.
Modern apprenticeships
Depending on the circumstances, a modern apprentice may be working under either a traditional contract of apprenticeship or a contract of employment. A modern apprentice working under a contract of employment has the same statutory employment rights on termination of contract as any other employee. The worker’s right to notice of termination of the contract is likely to be set out in the contract itself.
Statutory employment rights
It should be borne in mind that apprentices have the same statutory employment rights as employees. This means that they are entitled to claim unfair dismissal if the company fails to follow the statutory minimum dismissal procedure ( minimum dismissal procedures ) or acts unreasonably in terminating their contract. They may also be entitled to a redundancy payment, if they are dismissed for redundancy and have been with the company for two years.