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Unpaid Internships: Are They Always Legal?

While bosses, like Muffin Break’s Natalie Brennan, might complain young people should be lining up to work for free if they want to make it in professional industries, it is important to know that unpaid work will generally only be lawful in a handful of circumstances where certain rules are adhered to.

The most common reasons you might enter into unpaid work are to gain experience in a job or industry or to test your job skills before taking up employment with a business.

These types of unpaid work are legal as long as the work does not give rise to an “employment relationship” between you and your employer – an employment relationship may exist even if your employer says your work is just to “learn the ropes” or “see whether you can do the job”. Where an employment relationship exists it means that you are actually an employee and you are entitled to be paid at the appropriate rate for your work.

Whether this relationship exists can sometimes be hard to tell. Some key things to consider are:

  • What is the nature and purpose of your work? If it was merely to provide you with training and experience in the industry then this might be ok, but if the arrangement involves you contributing to the ordinary work of the business for their primary benefit then this could indicate an employment relationship.
  • How long are you expected to work unpaid for? Generally, the longer the period of work the more likely it is that you will be acting as an employee. While volunteering to gain experience might reasonably involve you working at the business for a couple of weeks, testing your skills to see whether you can do the job should normally take no more than a day or so.
  • How important is your work to the business? If you are tasked with doing work that would usually be done by a paid employee, then this could strongly indicate an employment relationship. As an unpaid intern your role should be primarily to observe and learn the operation of the business and if you do perform productive work it must be clearly related to you learning or gaining experience.

Before you start an internship it is advisable to clarify the terms of your work by asking key questions like what type of tasks you will be required to do and how long your period of engagement will be. If it sounds like you will be doing work that you should be paid for it is important to get further advice as the company may attempting to act illegally by getting you to work for free.

What if my boss says I need to complete training before I can get paid?

Unpaid training periods are illegal. If an employer is training you for a position, this means you are working for them and you are entitled to be paid for the contribution you are making to the business by becoming a more productive employee. Your employer is not entitled to terminate your employment because you ask to be paid for a training period.

What about vocational training placements?

Vocational training placements where you do not get paid are legal, as long as the placement is a requirement of a course at an authorised institution, like a university, school or TAFE, and the student is not required to perform work for which they would normally be entitled to pay as an employee. If these criteria are met the student will not be entitled to pay under the Fair Work Act, although the business may choose to offer you payment at their discretion.

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