When is an Intern a Volunteer?

Back in the late 1980′s when I was graduating from University, I was lucky enough to secure a ‘proper’ graduate position with a blue chip manufacturing multinational.  Whilst the economy wasn’t buoyant, it certainly didn’t have the challenges that many of today’s graduates face.

From my recollection, there was also no prevalence of unpaid internships.  There were work experience programmes both official (and well organised) or unofficial (less organised) which usually meant one or two weeks shadowing employees to see what they did in order to learn a little more about the workplace.

Graduates in 2012 facing a bleak outlook for their initial career prospects now have the carrot of the unpaid internship dangled in front of them.  Some of these pay basic expenses and/or a lunch allowance but they are characterised by the individual undertaking actual work which would ordinarily be done by a paid employee.

I am often asked by companies where the line is drawn, is it legal, are they technically employees, what risks do I run and should they be subject to the rules of the business in the same way that ‘real’ employees are?  Here are the answers that I usually give.

 

What is the difference between work experience and an unpaid internship?

Setting aside any semantics, as I outlined above if the individual is undertaking ‘real work’ then they are an employee and the National Minimum Wage (NMW) legislation applies to them (currently £3.68 per hour for 16-17 year olds, £4.98 for 18-20 year olds and £6.08 for 21 and older).  So the ‘son of our biggest client’ who comes in and shadows several people for a week or two, may occasionally help with a presentation but otherwise is only there to see what happens; is not an employee and you can justify them being a work experience person.

 

What risks do I run by having an unpaid intern who is doing real work?

The answer will be – it depends.  Depends on whether the individual decides to be the one person who takes a stand and claims the NMW (very rare); depends on whether there would be an external body who comes in and checks on anyone who isn’t being paid NMW (probably even rarer); and it depends on whether you believe there is an internal or external reputational risk to having an unpaid intern.  In reality businesses probably know that the risks are low and hence the proliferation of interns.

 

An intern volunteers to do this, no-one forced them and thus it makes them a volunteer.

Yes and no.  Unless your organisation is a charity or similar, this argument doesn’t stand up to much scrutiny.  Yes they have volunteered to do it but the legislation is very clear.

 

If I do get an intern (paid or unpaid) or a work experience person into the business, should I carry out the usual checks that I do for employees; should they be subject to the same rules etc

In general I would suggest the answer(s) is/are yes.  If the individual is to have access to your systems, be able to see or hear documents or discussions that are confidential to the business and if your business is in a regulated sector then I would be even more emphatic in my answer.  It could be argued that an individual who is unpaid and may not have a strong personal connection to the business is even more of a risk to the business than an employee whose career is, for the meantime, with the business.  Think of a scenario where an intern (or a family member of an intern) undertakes PA trading which is then investigated uncovering the fact that the individual was never subject to the company’s compliance rules.

 

 

I think that the unpaid intern is a phenomenon that is unlikely to disappear soon and the correlation of the number of unpaid interns to the strength of the wider economy is strong.  The arguments about whether this is ‘right or wrong’ are well rehearsed and thus don’t need repeating here.  My view is that of the risks I mention above, the one most employers should be concerned about is having an individual in the business who has not undergone any background checks or compliance awareness training.