diff --git a/nvflare/private/fed/app/client/sub_worker_process.py b/nvflare/private/fed/app/client/sub_worker_process.py
index e0d5711ee4..aeb6d297aa 100644
--- a/nvflare/private/fed/app/client/sub_worker_process.py
+++ b/nvflare/private/fed/app/client/sub_worker_process.py
@@ -18,7 +18,6 @@
 import copy
 import logging
 import os
-import sys
 import threading
 import time
 
@@ -310,9 +309,6 @@ def stop(self):
 
 def main(args):
     workspace = Workspace(args.workspace, args.client_name)
-    app_custom_folder = workspace.get_app_custom_dir(args.job_id)
-    if os.path.isdir(app_custom_folder) and app_custom_folder not in sys.path:
-        sys.path.append(app_custom_folder)
     configure_logging(workspace)
 
     fobs_initialize(workspace=workspace, job_id=args.job_id)
diff --git a/nvflare/private/fed/app/simulator/simulator_runner.py b/nvflare/private/fed/app/simulator/simulator_runner.py
index ef61de3a2f..a7f38138fb 100644
--- a/nvflare/private/fed/app/simulator/simulator_runner.py
+++ b/nvflare/private/fed/app/simulator/simulator_runner.py
@@ -670,6 +670,10 @@ def do_one_task(self, client, num_of_threads, gpu, lock, timeout=60.0, task_name
             name=ConfigVarName.DECOMPOSER_MODULE, conf=SystemConfigs.RESOURCES_CONF
         )
 
+        app_custom_folder = Workspace(root_dir=client_workspace, site_name="mgh").get_app_custom_dir(
+            SimulatorConstants.JOB_NAME
+        )
+
         command = (
             sys.executable
             + " -m nvflare.private.fed.app.simulator.simulator_worker -o "
@@ -698,7 +702,7 @@ def do_one_task(self, client, num_of_threads, gpu, lock, timeout=60.0, task_name
         if gpu:
             command += " --gpu " + str(gpu)
         new_env = os.environ.copy()
-        new_env["PYTHONPATH"] = os.pathsep.join(self._get_new_sys_path())
+        new_env["PYTHONPATH"] = os.pathsep.join(self._get_new_sys_path()) + os.pathsep + app_custom_folder
 
         _ = subprocess.Popen(shlex.split(command, True), preexec_fn=os.setsid, env=new_env)