Recently, the topic of unpaid internships came up in the people2people office. A few members of our team had undertaken internships without pay to assist with their career development. Curious about the legality of unpaid internships, I thought we should investigate and share our findings on our blog. On initial inspection of job boards, you can quickly discover opportunities labelled as internships, many of which are unclear about pay or specifically state that interns will not be paid. In the modern job market, particularly in certain industries and countries, unpaid internships are becoming increasingly common. But are they legal in Australia? I was able to track down some information from Fair Work Australia. They state:
A work experience arrangement or internship is when a person works for a business to gain experience in a particular occupation or industry. These arrangements can be a valuable way for prospective employees to make the transition from study to work or explore a new career path. Sometimes these arrangements span several months and can lead to ongoing employment.
An unpaid work experience arrangement or unpaid internship can be lawful if it is a vocational placement or if there is no employment relationship found to exist. In particular:
- the person must not be doing “productive” work
- the main benefit of the arrangement should be to the person doing the placement, and
- it must be clear that the person is receiving a meaningful learning experience, training or skill development.
A vocational placement is where the work experience is a formal part of an education or training course and can be lawfully unpaid. Defining a vocational placement can be tricky, and Fair Work have provided a fact sheet. The bottom line is that the placement must be part of an approved course. Otherwise, the intern should be paid minimum rates. Interns who meet the vocational placements criteria are not considered to be employees and therefore are not subject to minimum wages criteria. So, if you are considering an unpaid internship, make sure you get the facts beforehand to ensure you are not entitled to be paid. Conversely, if you are an employer who wants to employ interns, I would recommend contacting your local education providers or Fair Work Australia to ensure you are not liable.