Times are tough, right? Whether you’re a multi-national company or a new start-up (or something in between, most likely!), everyone could do with an extra set of hands.

Due to the difficult job market at the moment, it’s not uncommon for recruiters to have graduates and students banging down their door offering their services to your company. What’s the price-tag? Free!
So, let’s get this straight – Times are tough, you need extra help, and highly-intelligent graduates and students are offering their services for free? Where do I sign?

Unfortunately, this thought process could lead you down avenues more troublesome than they’re worth. In this article, we will be exploring why that route is any company’s nightmare and the proper way to offer internships.

Paid Internships

Paid internships are any internship which is paid at least the National Minimum Wage. They can last up to one-year and are completely un-contentious.

You should treat these as, essentially, fixed term contracts. They are a great way to get new talent into the organisation and will attract a wider-variety of candidates.

Why? Many believe that contacts are the biggest barrier into professions (like events).

However, the biggest barrier to employment is actually finances. Payment removes this barrier and allows you to recruit the best regardless of their financial and social background. If budget isn’t too much of a problem, you should consider paying the living wage in your area. This is the level of payment a person is calculated to need in order to provide a normal standard of living. You’ll attract an even wider range of candidates then.

Due to paid internships being contractual in nature, you can expect a return on investment. Paid interns can be charged with obligations and responsibilities and you should treat them as any other worker.

Unpaid Internships

Unpaid internships are non-contractual arrangements. Unpaid (or expenses only) interns are free to come and go as they please with no obligation to do anything what so ever. Unpaid internships should not be used as an extended interview process. Interns should be there to meet people, make contacts, receive training, acquire references, and take part in company activities which your company already intends to do.

Got a big project coming up? By all means, get an unpaid intern involved, perhaps even have them contribute, but at no point should that interns contribution be freeing up the time of another nor should the intern be responsible for the project.

Most employers would be shocked to know that unpaid internships are very rarely legal. In reality, even if a person agrees to work unpaid, if they are performing the role of a worker then they are entitled to make a claim against you for back payment of national minimum wage and holiday pay (and you’ll receive a hefty fine too!)

Unpaid internships aren’t quite the utopia many people think they are. They are an altruistic act by you and an intern is the beneficiary, not you. We all understand that an unpaid internship will incur a loss of productivity on your organisation. However, if you cannot offer them as an altruistic gesture, without a return on investment, then unpaid internships are not right for your organisation. But there is another way…

An Alternative Approach

Graduates will always be entitled to be paid the National Minimum Wage where they are performing a worker role and there is nothing you can do about it.

You could scream to the skies until you’re blue in the face that you did unpaid work as a young worker, that you are a new start up and don’t have the budget to pay, that your industry has been doing this for years, etc. These concerns, though legitimate, mean nothing if an intern were to take you to court.

However, if you do need work done and have legitimate concerns, whatever they may be, stay on the right side of the law and instead consider offering sandwich placements.

These placements are done in conjunction with a University. What you would do is package the work you need done as a project that a student could do as part of their course. Such arrangements are exempt from National Minimum Wage for up to one year. You would need to provide some level of training and supervision, you would need to provide detailed feedback to the university, and you’d probably have to cover expenses – but in this instance, you would get a return on your investment.

Any catch? We can’t think of one!

Points to Take Away

1. Paid internships are un-contentious and attract a wide-range of candidates regardless of financial background.

2. If you’re offering a paid internship, the minimum you can offer is the age appropriate rate of National Minimum Wage. You can offer more if you like, and offering the living wage is ideal.

3. Paid internships offer a return on investment.

4. Unpaid interns are not obliged to do anything or even be there at all. They will get out of their arrangement what they put in, but they are not a substitute for paid jobs.

5. If you’re feeling altruistic and don’t expect any return on your investment, unpaid internships could work for your organisation. If you want to get someone involved in something interesting you’ve already allocated paid staff to do, ask an unpaid intern to be involved with the process by all means.

6. You should never benefit from unpaid labour as this is illegal. You could end up in court paying out more than you would have done if you’d just offered a paid internship.

7. If for any reason you can’t afford to offer the National Minimum Wage (it can happen in this climate), work with a local University to offer sandwich placements. You will be required to make an investment in an intern by your time, but you can also expect a return.

Feel free to ask questions about this in the comments below and I’ll answer as best I can.

Craig

Craig Ineson is a law graduate of the University of Liverpool, current student of international business law at master’s level, a passionate restaurant reviewer, and experienced content writer.

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