Robert McCreath: Internships – No longer in Vogue?

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Condé Nast discontinues intern program. Do you hear that? That’s the sound of editorial assistants sobbing (via @lindsaykap).

Condé Nast has been sued in the US by two former interns who claimed they were paid below the minimum wage during internships. As a result, the publisher is reported to be discontinuing its internship scheme.

Whether any editorial assistants are sobbing is very doubtful. But this news has provoked decidedly mixed reactions from commentators – from gnashing of teeth to celebration. Some former interns fondly recall their time on little or no pay and claim that it eventually led to their current blossoming career. Other commentators rejoice that the rich kids whose parents can afford to support them will no longer find it so easy to jump the queue for that all-important work experience.

In the UK, although the minimum wage laws are not the same as those in the US, the picture is similar. Employers in highly sought-after areas of work, such as fashion, media, PR (and even law) are accused of exploiting unpaid interns when they should be paying at least the minimum wage. Campaign groups such as www.internaware.org have successfully supported interns in legal action against UK employers and momentum is growing.

The UK law on this is tolerably clear. In essence, subject to limited exceptions (such as those carrying out genuine voluntary work for a charity or still within compulsory school age) the national minimum wage applies to all “workers”.

The term “worker” is defined broadly to include any individual who agrees to carry out work or services personally for another party under a contract, except through a profession or business genuinely carried on by that individual.

So, the crucial distinction regarding interns is whether or not they have any contractual obligation to carry out any work or services. Where interns are required to be in the workplace for specified hours and/or required to undertake tasks which would otherwise normally be undertaken by employees, they should be considered to be “workers”, entitled to the national minimum wage.

It does not matter for this purpose whether the contract is written or oral. Contracts can arise informally and can be implied from the conduct of the parties.

Where, on the other hand, the interns are not required to be in the workplace for specified hours or to undertake tasks which would normally be undertaken by employees, they should not be considered to be “workers”, and should not be entitled to the national minimum wage. This is typically the case where the interns are basically “shadowing” one or more members of staff. They might be given some tasks to do in that context, but it is unlikely that the employer will gain any substantial value from the completion of those tasks by the intern.

Such arrangements should be quite short – a few weeks at most. Otherwise, there is an increasing  risk that they will evolve into employment relationships. As interns become more experienced, they are more likely to produce valuable output for the employer. Regular working patterns and mutual obligations are more likely to emerge, under which it could be implied that a contractual relationship has developed.

HR practitioners dealing with internship arrangements should first of all make sure what kind of scheme is intended. As a rule of thumb, if it is intended that the interns will be carrying out work that would otherwise be carried out by employees, the interns should be paid at least the minimum wage.

If the intention is not to pay at least the minimum wage, the arrangements with the interns should clearly state in writing that they are under no obligation to attend the workplace at any particular hours or to carry out any work. They may be offered the opportunity to carry out tasks for the purpose of gaining work experienced but should be free to choose not to if they wish.

Careful consideration should also be given to what happens in practice and in particular the hours which the interns actually spend in the workplace and how they are treated by colleagues. Those supervising interns should be given suitable guidance. There have been well-publicised cases of interns working excessively long hours and suffering serious health issues and even death as an apparent result. The pressure that people put themselves under to get into a desirable line of work should not be underestimated.

Some argue that “shadowing” or similar arrangements are of very little value for interns and that only “real” work experience gives them a full flavour of what it is like to work in the relevant industry and enables them to start developing the necessary skills and attributes.

This is probably true. But it is also true that interns who are required to carry out “real” work are creating “real” value for their employers. The national minimum wage is there as a safety net to protect people against exploitation. The current rates (as from October 2013) are £3.72 per hour for those aged under 18, £5.03 for 18-20 and £6.31 for 21 and over – hardly a King’s ransom. Surely employers should pay at least those rates to people who are carrying out valuable work for them, even if those people are also gaining valuable experience.

I would suggest that employers are more likely to ensure that properly paid interns are carrying out relevant work and are developing relevant skills, rather than merely being exploited by their co-workers as free or cheap sources of labour.

Unpaid “real” work experience schemes do allow the already advantaged offspring of more affluent parents to extend their advantage unfairly. If we accept that equality of opportunity and social mobility are desirable, it is hard to avoid the conclusion that such work experience schemes are distinctly undesirable.

Such schemes also provide an incentive for employers not to create more paid jobs. After all, why should they if people will do the work for free?

So, with apologies to anybody out there who may be sobbing about the loss of their team of unpaid “gophers”, the demise of the long term, exploitative internship scheme is to be welcomed. Perhaps there will be fewer opportunities to gain work experience in certain industries as a result, but let’s hope they will be of better quality.

Robert McCreath is a partner in specialist employment firm Archon Solicitors

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  1. A sensible article.

    Robert’s astute in warning companies they need to monitor managers’ PRACTICES as well as the formal arrangements when interns are offered “work shadowing” or “work experience”.

    I hope the decline in unpaid internships will be followed by a similar reduction in the exploitative unpaid “work” component of DWP’s Work Programmes.

    Most unemployed people were previously employed, often in more demanding jobs than the DWP Work Programmes offer. There is nothing sub-standard about them as individuals, they are unemployed because the national / global economy has been malfunctioning. A sensible Work Programme would address the particular barriers individuals faced in gaining work – eg lack of personal transport or the need to update higher level qualifications.

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