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Employ someone for free and call it an internship

Sounds like a great idea, doesn’t it?  Lots of lovely free labour and in return, you show them exactly how to do the job you’re not paying them for.  You’ll pay them their expenses, won’t you, to make sure they’re not out of pocket.  In the meantime, you’ll moan about clients who expect you to put design briefs together, attend numerous meetings and generally carry out work for which they have no intention of paying you.  Oh.  Is that the sound of the proverbial penny dropping?

No one likes doing work they’re not going to get paid for unless they’re a volunteer.  Normally if that’s the case then the person volunteering does so for a good cause, not solely to line someone else’s pockets.  Most people consider that to be exploitation.

Unfortunately, we appear to have gained a culture of unpaid internships here in the UK.  I’ve heard stories of airlines having pilots work for them for free as they need to keep up their flying hours for their licences while they look for work.  It’s well known that  unpaid internships are rife in the publishing industry and also in the fashion industry.  I’ve heard that some employers use excuses for free labour like “you must be self-employed” and “we only pay expenses for work experience”.

We also have legislation called the National Minimum Wage (NMW).  You may have heard of it.  It’s not a guideline – it is in fact a statutory requirement which means that the majority of workers are entitled to it and those who aren’t fall into specific categories.

The work placement or internship used to mean a defined period of time (often two weeks) that a student would have an opportunity to work in a company. That period of work would be unpaid but it would form part of their studies in some way.  In that specific case, the employer is under no obligation to pay the person – they aren’t an employee and they don’t get any employee rights during the period in question.  So, let’s just clarify that.  Students of compulsory school age doing work experience are not entitled to be paid, nor are students doing work experience as part of their course.

The only other person who should not expect to receive pay for work done is a voluntary worker and as you might expect, HMRC has a strict definition of a voluntary worker explained here.

In all other cases, a person doing work for a business, can reasonably expect to get paid.  What’s more, HMRC don’t like it when people don’t get paid according to NMW rules.  They recently launched a “dynamic response unit” to ensure that interns do get paid the minimum wage.  This twelve person unit will be able to make unannounced inspections of businesses, will have powers to question managers and go through accounts until they are satisfied that no abuse of the NMW rules has taken place.

The existing system for reporting abuses of NMW rules relied on interns to blow the whistle on their employers.  However, unpaid interns take the work because they need experience and they need references so they were unlikely to bite the hand that feeds them.  Or in most cases, the hand that gave them scraps and expected them to be grateful.

Although the problem is rife in bigger businesses and it may be tempting to follow suit, taking advantage of some free labour, no small business owner should be offering unpaid internships.  If you value the extra pair of hands helping your business to grow, make sure you pay them.

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