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Now that spring is fully underway, many law and accountancy firms will be looking to fill their summer internships and vacation schemes with promising candidates for full-time roles in the coming years.\u00a0\u00a0<\/p>\n
These schemes present an opportunity for firms to assess prospective future employees (and vice versa).\u00a0 An added benefit is that they also enable the firm to use the additional resource, in part to fill the void left by those on their summer holidays, without adding to permanent head count.\u00a0<\/p>\n
Some law firms have been known to charge clients for the time spent by those on a vacation scheme working on their matters.\u00a0\u00a0\u00a0\u00a0<\/p>\n
Although an intern works on a short-term basis, and possibly without remuneration, there is a range of legal issues to bear in mind.\u00a0\u00a0<\/p>\n
This short guide highlights five key considerations for professional services firms when looking at offering internships.<\/p>\n
There is no legal status which applies to all interns.\u00a0 They may be employees, \u201climb (b)\u201d workers, or neither:\u00a0\u00a0<\/p>\n
It is tempting for firms to think that their internships should be characterised as volunteering arrangements, as a volunteer will not have employment rights, including \u2013 controversially \u2013 a right under the Equality Act not to be discriminated against.<\/p>\n
However, labels are largely unpersuasive. \u00a0Employment tribunals have frequently found that interns who were paid expenses have, in fact, been paid for work, and were therefore (at least) workers. Volunteer status also means the intern is not obliged to turn up for work or subject to a contractual duty to follow reasonable instructions from the firm.\u00a0<\/p>\n
As an employee or worker, an intern will be entitled to the right not to be discriminated against, paid annual leave, and the right to be paid the national minimum wage.\u00a0<\/p>\n
If an intern is an employee and is ultimately hired by the firm indefinitely, firms should ensure that the individual\u2019s period of continuous employment is correctly calculated.\u00a0 If there is a break in between the two roles then the period may be broken and reset to zero.\u00a0 If not, the employee will have the right not to be unfairly dismissed and the right to a redundancy payment after two years following the date he was first hired as an intern.\u00a0<\/p>\n
If your interns do not receive monetary payment or benefits in kind (other than reimbursement for expenses) in return for work, they will not be employees or workers and there will be no entitlement to the national minimum wage (NMW).\u00a0<\/p>\n
According to Government guidance, simple work shadowing which does not involve an intern performing any particular work will not entitle an intern to the NMW.\u00a0<\/p>\n
However, a placement that may lead to an offer of permanent or paid work could result in the intern being deemed a \u201cworker\u201d, as the promise of paid work is a \u201cbenefit\u201d for the work undertaken by the intern.\u00a0<\/p>\n
Once an internship or work experience shades into an obligation to perform tasks in accordance with the firm\u2019s instructions, the individual could be a worker and therefore entitled to the NMW. \u00a0Failure to pay the NMW could not only result in the firm having to make good the difference, but it may be criminally liable in some cases. \u00a0\u00a0\u00a0<\/p>\n
However, there are some exclusions from the minimum wage entitlement:<\/p>\n
Documenting the relationship will be a helpful way of establishing that any intern is a genuine volunteer and outside of the scope of the NMW.\u00a0 In that case, the agreement should cover matters such as the date of the placement, suggested (rather than obligatory) hours of attendance, and which work-related expenses are covered.<\/p>\n
This will be required if a proposed intern is subject to immigration control. \u00a0\u00a0For those who do not already hold immigration permission which enables them to take up the internship, the Temporary Worker \u2013 Government Authorised Exchange Scheme may be the best immigration route for them.\u00a0 This will require you to register with an Authorised Exchange Scheme in order for the prospective intern to be sponsored under the category.\u00a0<\/p>\n
Alternative routes may also be possible depending on the intern\u2019s individual circumstances, the specifics of the role and remuneration on offer.<\/p>\n
You should avoid a policy of \u201cresident only\u201d interns. This could be considered as discriminatory.\u00a0 However, you should make any offers of a placement conditional on appropriate immigration status and check early on in the process what permissions may be required.\u00a0 You should be asking for proof of the right to work of all applicants in order to avoid accusations of discrimination.<\/p>\n
Unlike employees, intellectual property rights created by interns will not automatically be considered the property of the firm.\u00a0 Therefore, an agreement which requires individuals to assign any intellectual property rights that they might create whilst on placement (such as blog posts, articles or presentations) is advisable.<\/p>\n
Interns should also be required to observe confidentiality in order to protect sensitive commercial information which they may receive in the course of their placement.\u00a0 Otherwise, the firm may not have any legal remedy if key know-how, client information, gossip or intelligence finds its way to a competitor when a vacation scheme candidate moves on to another firm.\u00a0 \u00a0\u00a0\u00a0\u00a0<\/p>\n
Interns, vacation scheme candidates, those on work experience and volunteers will all be data subjects under the UK General Data Protection Regulation and Data Protection Act 2018.\u00a0 They should therefore be given a data privacy notice describing what data will be collected and held by the firm, and the firm should observe the usual restrictions which apply to controllers of personal data.<\/p>\n
Work experience and internships can often be given to the relatives, friends and connections of partners and clients.\u00a0 Whilst there is no obligation for firms to open up work experience opportunities to a wider group of people, firms should be aware of the risks of accusations of discriminatory treatment or nepotism. \u00a0<\/p>\n
Best practice for paid internships and vacation schemes is to ensure that a fair and documented recruitment process is adopted for interns as would be applicable to your employees.\u00a0 You should document the criteria applied to applicants and how the applicants were assessed against those criteria.\u00a0 This is particularly the case where an internship is competitive and could lead to offers of full-time employment in the future.<\/p>\n