THE EMPLOYERS' EDGE
Time for Employers to go Back to School on the legalities of Internships
It’s back to school time. For many students, this means the beginning of looking for placements at employers to build on their classroom experiences, gain experience or fulfill program requirements. Employers, though should be cautious in offering unpaid internships to anyone without fully considering the potential liability.
Until recently, employers often offered unpaid internships to students or recent graduates to provide an opportunity to gain real world experience and begin their professional careers. Employers may recall that in 2014 the practice of unpaid internships came under fire by the Ministry of Labour and the general public. The main complaint was that interns were taking the place of employees and that employers were having work performed without having to pay wages.
Any employer who is considering offering an internship should be aware that there is liability exposure as an intern can make a claim under the Employment Standards Act, 2000. The easiest way for an employer to avoid this liability is to treat any intern as an employee. This means paying the intern minimum wage and abiding by other statutory minimums.
However, many employers are reluctant to pay interns when the perceived value of their work is lower than an employee due to the training requirements. Employers are able to offer unpaid internships in two unique circumstances.
First, an employer can make an arrangement with a college or university to take unpaid placement students. Often, this would be in the form of a co-op program and would offer students the opportunity to gain practical training to complement their classroom experience. If a student is sent by a college or university to an employer, the intern will not be considered an employee for the purposes of the Employment Standards Act.
Second, an employer can have a legal unpaid intern if six (6) conditions are met. These six (6) conditions are:
- The training received is similar to that in vocational school;
- The training is for benefit of the intern;
- The employer derives little if any benefit from intern while he or she is being trained;
- The training doesn’t take someone else’s job;
- The employer isn’t promising the intern a job at the end of his or her training; and
- The intern has been told he or she will not be paid for his or her time.
The Ministry of Labour often catches employers by surprise when individuals are working as interns but do not meet all of the above criteria. Employers must be aware that simply calling a position an internship is not enough to avoid liability under the Employment Standards Act. Unless either of the above exceptions is met, an individual will be considered an employee regardless of their official title.
Additionally, employers should be aware that even if an intern is exempt from the requirements of the Employment Standards Act, the Occupational Health and Safety Act has been amended to extend protections – including work refusals – to interns. Interns are now included in the definition of worker and employers must extend all Occupational Health and Safety requirements and training to them.
If you are considering offering an unpaid internship to a student or anyone else it is important to consider your legal obligations. The lawyers at CCPartners can assist you in determining if your position will fall into one of the exceptions discussed above. Click here for a list of lawyers that can assist you in ensuring that your positions are compliant with the Employment Standard Act.