Changes to law brings unpaid internships into focus
A change to the definition of a worker may cause unpaid internships to carry on unchallenged in 2015.
Changes made to the definition of what a worker is under British law have caused queries to be raised by anti-unpaid internship pressure groups over the impact this might have on graduates and young people. The issue revolves around whether or not interns should be classified as workers or volunteers and changes to the definition of the word 'worker' have alerted pressure groups about the possibility of exploitation.
Last year saw a serious decline in the amount of unpaid internships, with Her Majesty's Revenue and Customs beginning to take companies to court over not paying workers the minimum wage. However, changes to the definition has made the approach to hiring an intern or volunteer much more oblique.
From the Gov.UK website, it states: A person is generally classed as a 'worker' if:
- they have a contract or other arrangement to do work or services personally for a reward (your contract doesn't have to be written)
- their reward is for money or a benefit in kind, eg. the promise of a contract or future work
- they only have a limited right to send someone else to do the work (subcontract)
- they have to turn up for work even if they don't want to
- their employer has to have work for them to do as long as the contract or arrangement lasts
- they aren't doing the work as part of their own limited company in an arrangement where the 'employer' is actually a customer or client
The importance of having interns classified as workers, rather than volunteers allows them the statutory rights such as holiday, not to work 48 hours a week or more (unless they opt out) and most importantly the national minimum wage.
Co-Director of the pressure group Intern Aware, Gus Baker, told the Daily Telegraph, 'National Minimum Wage law has stayed the same but the guidance from HMRC has changed. They are able to support the law but they have narrowed their discretion.'
Baker added 'These new guidelines potentially make it much tougher to enforce the law and we think HMRC needs to take more cases to court and be much more vigorous and active in court – otherwise, they are basically making it up as they go along.'
However, a Department of Business, Innovation and Skills Spokesperson said 'The definition of a worker hasn't changed, nor has the impact on paying interns. If an intern was paid anything more than out of pocket expenses, they would become a worker and due NMW.'
'If the role is truly voluntary, the intern cannot receive more than expenses – this includes benefits in kind such as the promise of a job at the end of the placement or tickets to an event.'
By James Howell
View our Internships and Work placements
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