You’re Hired…..?

As the latest series of “The Apprentice” reached its climax last night, other work placement schemes such as summer internships and vacation placements are just kicking off. Lord Sugar has decided on which of his “apprentices” to hire, but it is vital for employers to understand the implications of them taking on work placement staff.

What employment rights, if any, do interns, work experience or vacation students have?

Interns, work experience and vacation students have rights!

They are not “apprentices” and the level of rights and protection they are afforded will depend on the circumstances – not the label given to them! Broadly speaking an intern, work experience or vacation student will either be an employee, a worker or a volunteer. Which category they fall into determines the rights they have.

In most cases, interns, work experience and vacation students (as opposed to those simply observing the workplace – work shadowing) are likely to be workers. They are therefore entitled to a number of basic rights, including the right to receive the national minimum wage, the right to paid holiday and protection from discrimination (including on the grounds of age). In some cases, an intern may be an employee – with the whole panoply of rights afforded to other employees in the workplace – and potentially additional rights arising from being employed for a fixed term.

The threshold to demonstrate employee status is higher than for a worker but not difficult to satisfy, even for a summer student. There must be a contract of employment (oral or written); work must be performed personally; there must be a mutual obligation for the employer to provide work, and the employee to undertake it; and the employee must be subject to the direction and control of the employer. Tick these boxes and it does not matter what you call your client’s nephew – he is likely to be an employee, albeit a temporary one!

Volunteers are more complicated still, with there being a distinction between a ‘volunteer’ and a ‘voluntary worker’.

  • A volunteer must not have a contract to perform work, or provide services, and must receive no financial remuneration or benefits in kind, or they risk becoming a worker. It may be that an appropriately informal work experience placement, where little work of value to the organisation is actually carried out, may qualify for volunteer status.
  • A voluntary worker must work for a charity, voluntary organisation or associated fundraising body etc and will be expressly excluded from the right to receive national minimum wage provided they receive no payment (other than expenses actually incurred) and receive no benefits in kind (other than accomodation etc).

Apprentices

From a true employment law perspective, it is unlikely that Lord Sugar’s apprentices are actually apprentices at all. Apprenticeships are open to all age groups above the age of 16, and are normally for a fixed term and/or until a level of qualification is reached. A traditional apprenticeship can be entered into (governed by common law) and apprentices working under this model will be employees, albeit with training as the primary purpose.

A traditional contract of apprenticeship gives enhanced rights on termination and employers owe greater obligations to apprentices than other employees. The ordinary laws of dismissal do not apply, so there is less scope to dismiss for misconduct and, if the contract of apprenticeship is terminated early, the apprentice will be entitled to enhanced damages on termination.

Since 2011, employers are more likely to hire an apprentice under an Apprenticeship Agreement, governed by the Apprenticeships, Skills, Children and Learning Act 2009. These agreements must be in a prescribed form and are more akin to a regular employment contract, without the enhanced rights on termination arising from a traditional apprenticeship arrangement.

Practical tips

The basic rule of thumb is, unless an individual is genuinely work shadowing and for a limited amount of time, employers should assume that an intern, work experience or vacation student is, at the very least, a worker. Simply labelling an individual an “intern” will not determine employment status – it is what is in the tin and not the label that counts! Failure to get it right could result in employment claims, severe financial penalties, bad publicity and potentially criminal liability.

Do:

  • Make sure the nature of the relationship and the working arrangements are clear from the outset.
  • Detail the agreement in writing – including appropriate provisions in relation to confidentiality.
  • Consider whether the individual is a worker (ie performing work) or a true observer (work shadowing).
  • Pay the national minimum wage – unless the individual is simply in the workplace to observe (and yes, even to summer work experience students on two week placements. If they do any work, even photocopying and running errands, they are likely to be workers).
  • Consider whether there is an entitlement to paid holiday – workers cannot be deprived of that right, even if they are employed ‘during the holidays’.
  • Consider health and safety and the Working Time Regulations in relation to rest breaks and maximum number of hours worked.

Do not:

  • Agree to a loose informal arrangement, just because they are the daughter of a director.
  • Assume that you will not require the individual to perform work – summer students come in remarkably handy once they are through the door.

Treat summer students with less respect and dignity than you would other staff.