When “Internships” can be Expensive for Employers

In 2013, the Fair Work Ombudsman commissioned a report on the subject of unpaid work in Australia, as there is growing concern about the application of unpaid internships / work experience placements within Australian businesses.  The FWO has recently completed its first of what I suspect may be many prosecutions of businesses who fail to pay minimum wages to “interns” where it has been proven such interns have been required to do more than watch, listen and learn.

For many years, young people have hunted for work experience opportunities in the hope of breaking into a particular industry and/or a specific business.  At the same time, many employers also openly promote their work experience / internship programs.  However, FWO are concerned at the number of businesses who are at risk of exploiting unpaid interns when they are required to produce work that contributes to the overall productivity of a business. 

Fair Work Ombudsman Natalie James said when a worker “moved 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”.  “The FWO did not want to stifle genuine learning opportunities that help young people get a foot in the door but we also don’t want to see young people being treated unfairly through unpaid work schemes”.

For any employer who is currently or considering offering internships that are “unpaid”, please ensure you have taken the right steps to demonstrate that your work experience placements are offered on the basis of a genuine learning opportunity and not one where the business can profit from the experience of an unpaid intern.

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