Many industries are notorious for ‘interns supervising interns’ with hardly anyone being paid at all. Some high street names and even MPs advertise this sort of roles. Don’t be fooled. They are not always legal. HMRC can and do investigate these arrangements – check out some of the news on High Street names.
You can understand the advantages of the arrangement from both sides. The ‘intern’ hopes to get experience that will help to bolster their cv. And the employer gets a ‘free’ look at possible candidates, and may (if lucky) get some useful work that outweighs the cost that comes from the disruption and distraction to experienced staff.
But – and it’s a big ‘but’ – these arrangements often seem to ignore the National Minimum Wage [NMW] rules.
In the UK, anyone under a contract (which can be oral or in writing) whereby they undertake personally to do any work or perform any services is entitled to the NMW (at the relevant rate) unless they fall within specific and limited exemptions.
The exemptions are complex and have a variety of conditions applied to them. To be accurate and complete about them would take a book! But as a quick summary:
The label someone has (for example: trainee, probationer, intern) makes no difference.
Trainees or probationers or interns ARE entitled to NMW unless they are:
1) on specific government training schemes such as: Entry to Employment or Programme Led Apprenticeships; Skillbuild ; Get Ready for Work or Skillseekers; Training for Success; or
2) on European Social Funded or Government funded placements of less than six weeks; or
3) volunteers working for a charity, voluntary organisation (such as a local community organisation) associated fund raising body or statutory body; or
4) students on a higher or further education course including a work experience requirement of not more than one year.
Individuals on an ‘internship’ leading to paid employment are often entitled to minimum wage throughout their ‘internship’ and paid employment period – because they are working.
HMRC enforces minimum wage rules. Their guidance suggests that a person who is simply ‘shadowing’ team members in different parts of an organisation is not performing work, and in that case would not qualify for NMW.
Work observation or work experience?
So, if the “work experience” is actually just “work observation”, and the individual is not required to do any work, then it doesn’t have to be paid. But if “work experience” involves actual working, then, unless one of the specific exclusions applies, NMW minimum pay rates must be paid – at the risk of both paying back pay to the individual, and a hefty fine.
Christopher Head is director of specialist employment law consultancy Irenicon Ltd. Christopher helps people to get the law on their side, and to avoid being tripped up by rules they don’t know about.
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