The widespread practice among employers of offering unpaid work experience has been a sleeper, but it's one to watch. In 2013, after a report found that unpaid work in Australia existed on such a scale that warranted legal attention, the Fair Work Ombudsman (FWO) announced it would crack down on offenders in high risk industries (see our update here). The FWO has now completed its first prosecution of an employer involving unpaid work experience since the report.
The employer, a media company, was approached by two journalism students seeking work experience. The students completed short periods of unpaid work experience and were subsequently kept on to work as “volunteers”. The employer made “reimbursement-for-expenses” payments in respect of each shift worked. No wages were paid.
Once the FWO intervened, the employer cooperated fully and made back- payments to the students and another employee to the total tune of roughly $50,000. However, that wasn’t enough to prevent the prosecution and the FWO launched proceedings because of the “strong public interest” in deterring employers from underpaying workers. The Federal Circuit Court imposed a $24,000 penalty for breaching the Fair Work Act 2009 (Act), including minimum wage requirements and casual loadings.
Of course, the decision doesn’t mean all interns or work experience students must be paid. The Act provides for unpaid “vocational placements”. However, as noted by the Court, “when a worker moves beyond merely learning and observing and starts assisting with business outputs and productivity, workplace laws dictate that the worker must be paid minimum employee entitlements”.
Basically, if they're doing real work which you would otherwise have to pay someone to do, then you have to pay them. It's the law; it's also only fair.