The issue of unpaid internships has been in the news again lately. HootSuite, a Vancouver-based social media management company, ironically attracted widespread negative media attention after a post on social news website Reddit accused the company of breaking B.C. law by hiring unpaid interns. Elsewhere, Toronto city councillor Ana Bailao found herself in the media spotlight as a result of a recent tweet that advertised an unpaid internship in her office. As both HootSuite and Councillor Bailao recently learned, the practice of not paying interns often violates employment standards legislation.
In recent years, there has been an increase in the number of organizations using unpaid interns, and there seems to be widespread confusion over an employer’s legal obligations to pay for an intern’s services. Given recent media attention on this issue, and the fact that many college and university students are now looking for work, we thought it would be helpful to review the law.
In most circumstances, if a person performs work for an employer, the employer must pay him or her at least the minimum wage in that jurisdiction. Some exceptions exist for volunteering in the non-profit sector, training programs in particular professions and for student practicums which are part of the formal education process. However, most interns (typically, college or university students who want to obtain practical work experience) do not fall within these exceptions.
Canadian employment standards laws do not explicitly regulate internships. Thus, the question is whether interns qualify as “employees” performing “work” under the legislation, such that minimum wages apply.
According to B.C.’s Employment Standards Act, “employee” includes a person receiving or entitled to wages for work performed for another, a person an employer allows to perform work normally performed by an employee, and a person being trained by an employer for an employer’s business. Further, the Interpretation Guidelines Manual, which sets out definitions for “internship”and “practicum”, makes it clear that persons receiving on-the-job training not part of a formal education process must be paid at least the minimum wage. Similarly, Ontario’s Employment Standards Act, 2000, which specifically addresses training, requires employers to pay the minimum wage unless all of the following conditions are met:
- The training is similar to that which is given at a vocational school.
- The training is for the benefit of the individual.
- The person providing the training derives little, if any, benefit from the activity of the individual while he or she is being trained.
- The individual does not displace employees of the person providing the training.
- The individual is not accorded a right to become an employee of the person providing the training.
- The individual is advised that he or she will receive no remuneration for the time he or she spends in training.
The law appears to be somewhat less clear in other jurisdictions where there is a lack of interpretive aids and where “employee”and “work” are defined broadly in the legislation. Nevertheless, even in the absence of the more specific type of guidance set out in the B.C. and Ontario laws, the general rule is likely to be applied fairly consistently across the country. Remember also that an employer may not contract out of minimum employment standards, and will have a liability even if an intern agrees to work for no pay.
What, then, can employers do to ensure they don’t run afoul of employment standards legislation? Employers are well advised to take a close look at whatever internship or practicum programs they provide and ask the following question: ‘Is this the type of work that I would ordinarily ask one of my paid employees to do?’ If the answer is yes, and the work is not part of a practicum or other formal educational process, then it is likely that the person performing the work is owed at least the provincial minimum wage.