Working’ 9 to 5, But Not Making a Living: The Legality of Unpaid Internships, Work Experience Programs & Trainee Programs

August 31, 2016 | Monique Petrin Nicholson

Beth Warcholak, Summer Law Student, Edmonton

Many young individuals across the country participate in internships, which are utilized by employers in many industries, and which are seen by many individuals as an opportunity to gain valuable experience. An area of particular interest, and possible pitfalls, relates to internship programs that involve unpaid interns. Although every jurisdiction in Canada has legislation that permits interns in some circumstances to perform work without compensation, in many parts of the country these situations are limited and these limitations should be noted carefully by employers. Simply calling a position an “internship” will not – in and of itself – be enough to permit an employer to utilize unpaid interns, and the rights of workers in this regard cannot be simply waived or avoided by agreement between employer and employee.

All “employees”, whether working in a provincially or federally regulated sector, are protected by employment standards legislation. As employers will be aware, this legislation places duties on employers and establishes minimum standards in respect of a host of matters.  However, the legislation also provides for circumstances where work will be exempted from all or some of these usual standards. These exemptions include, for example, work that is done by a student as part of an approved education or work experience program, and individuals receiving necessary hands-on training for certain professions, such as in the medical, engineering, and legal fields.  It should never be forgotten that, regardless of whether an intern is exempt from certain employment standards minimums, they will always be protected by health and safety legislation and human rights legislation in all jurisdictions.

The majority of Canadian jurisdictions have employment standards legislation that includes a broad definition of “employee”, which could arguably include interns, both paid and unpaid. One interesting exception is Alberta. The Alberta Employment Standards Code, RSA 2000 c E-9, states that an employee is “an individual employed to do work who receives or is entitled to wages and includes a former employee”. Issues arise as to potentially circular arguments, wherein the fact of not paying wages appears – on its face – to give rise to an exemption from the Code, and therefore the right not to pay wages, and not to comply with the Code.  It should be noted that the courts have held that benefit-conferring legislation, such as the Employment Standards Code, must be interpreted broadly. Thus, Alberta employers must be careful, and should seek legal advice, in respect of any unpaid internship.

In all jurisdictions, unpaid interns have the right to file employment standards complaints if they believe that they should have been paid for their work, or that some minimum legislated employment standard has been breached. If an employment standards officer’s investigation reveals that the worker was entitled to pay, back-pay can be recovered from the company on behalf of the worker. In April of this year, the Ontario Ministry of Labour conducted a well-publicized blitz of Ontario workplaces, recovering almost $140,000 in wages owed to interns across approximately 20 workplaces.

Even if a company’s internship program is in compliance with all employment standards legislation, such programs can give rise to other important concerns for employers, including public relations considerations.  In some circumstances, internship programs have been perceived or portrayed as exploitative or contrary to corporate best practices.  However, developed and implemented in a careful, legal and conscientious fashion, they can be valuable programs from both the employer’s and the worker’s perspective.

Earlier this year, the federal government set forward a proposal to allow federally-regulated sectors to establish unpaid internships. The proposed internships could span up to four months, and would require that the position be “primarily for the benefit of the student”. The proposal has not been without controversy, and employers and their legal counsel will no doubt be watching for further updates with interest.


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