According to some observers, the vast majority of internships at nonprofits and elsewhere may well be illegal. “There is widespread mischaracterization of interns as persons receiving training,” says Andrew Langille, a lawyer and blogger in Toronto who specializes in employment, labour and human rights issues, “when in actuality they are employees.” That is, they might be perceived as employees by a court or other jurisdictional body if a dispute is raised between the intern and the employer.

And that could have dire repercussions for the employer.

No legal definition

The problem is that there is no legal definition of an intern. For example, earlier this summer, following a series of media stories questioning the legality of internships, the Ontario Ministry of Labour (MOL) took the unprecedented step of adding a fact page to their website entitled Internships in Ontario: What you need to know. The page makes it clear that, while no regulations pertaining to unpaid internships exist within the law, internships must nonetheless conform to a strict set of criteria to be considered legal.

The fact page lays out a six-fold test (borrowed from US law) that employers can use to determine if someone in an internship program is actually an employee, as defined by law, and thus entitled to minimum wage. While some internships do offer modest stipends, most interns are meant to be exchanging their time for training, without pay. The MOL test carves out a narrowly defined exclusion to Ontario’s Employment Standards Act into which trainees fit. The crux of it states that the internship must substantially benefit the intern, not the organization; it should not be linked to a promise of employment; and it should not displace an actual employee.

Only a lawyer can provide qualified legal advice on these matters, but internship programs that do not conform to those criteria may well be asking participants to function as employees without pay, which is illegal.

“The problem is right across Canada,” says Langille, who has closely studied related case law and labour standards. “Quebec, Manitoba, British Columbia and Ontario have some language in their legislation that addresses unpaid or voluntary labour, but most of these exclusions relate to post-secondary co-op or training initiatives.”

Taking a legal risk

Outside the post-secondary realm (and the medical field, where “intern” has traditionally had special meaning), there exist dozens of largely unregulated internship programs run by organizations that may — often unwittingly — be exposing themselves to potential legal action, depending on the parameters of their programs.

In Ontario, says Langille, they could be ordered by the Ministry of Labour to pay back-wages and overtime pay. They could face punitive damages and be sued under the common law.

In addition, there are human rights issues, such as discrimination and sexual harassment, as well as worker’s safety issues that have yet to be thoroughly tested before the courts as they relate to interns. “Interns fill the lowest rung in an organization,” says Langille, “so they’re quite susceptible to violations of workplace law.” Few organizations would want to become the test subjects for such cases.

Further to the drain on resources such legal battles would entail, there could also be public relations fallout. “They could develop a reputation as an organization that young people don’t want to work for,” says Langille. “All it takes is one blog post or somebody making a Twitter comment and an organization can be labelled.”

Growing in popularity

Internships have grown in use over the last three-to-four decades to become widespread across the corporate, public and nonprofit sectors in the developed world. The majority of interns are young people looking for a foothold in the workplace. Survey research published in 2010 by the HR Council for the Nonprofit Sector shows that 40% of post-secondary students indicating a “possible” interest in working in the nonprofit sector had already completed an internship or cooperative work arrangement. And beyond graduation, internships are often viewed as a pathway to employment within the sector.

Ross Perlin, author of the book Intern Nation: How to Earn Nothing and Learn Little in the Brave New Economy, has studied the internship phenomenon closely. In a Google Talks lecture from May 2011, he stated that 75% of college students in the United States now do at least one internship before graduation, compared to about 3% in 1980. He points out that some US colleges issue academic credits to students who complete internships, but only after paying tuition fees to the schools, even though the students do little or no coursework at the schools during their internships. Similarly, Perlin describes companies, such as Dream Careers Inc., that broker international corporate and nonprofit internships to students for fees (called “tuition”) as high as $9,499 (USD). It seems some interns (or their parents) are now paying a high price for the privilege of working for free.

“The organizations taking the most ethical and thoughtful approach to internships usually have two motivations,” Perlin wrote in an email exchange for this article: “to groom potential full-time employees or to train and mentor young people curious about a profession or the nonprofit world more generally. Unfortunately, far too many take a much more short-sighted, and potentially illegal, approach — using interns as free or cheap labor to replace or displace regular employees.”

Perlin, who works as a researcher for the Himalayan Languages Project in China, says that internships have become a “rite of passage” contributing to high youth-unemployment, which has reached record levels in recent years, according to the United Nations. Many jobs that would have once been considered entry-level positions have disappeared into the unpaid gray zone of internships. University graduates, already carrying the burden of high student debt, are now often faced the double burden of having to work for free once out of school, often doing multiple internships just to break into their field.

A recent New York Times article coined the term “Generation Limbo” to describe these graduates, many of whom face career stagnation before their careers even begin. This is in large part due to the fact that the internship system greatly benefits the wealthy. Perlin predicts that in two-to-three decades, the most influential levels of the most powerful industries will be governed by people who can afford to work in internships for free now.

Perlin doesn’t dispute the potential value of internships, but he stresses the need for fairness. “Interns can make real contributions to an organization,” he writes by email, “and that’s a good reason to bring interns on board, but they need to be properly compensated for real work and they should be offered regular employment if they’re ultimately doing the same kind of work that regular employees are doing.”

Interns versus volunteers

And a solid distinction needs to be made between interns and volunteers. “Some nonprofits use interns like volunteers,” writes Perlin, “but I think it’s better not to confuse the two terms — volunteers are selflessly giving their time out of a spirit of voluntarism, and in theory should have another regular source of income, whereas interns are almost always people who badly need a foothold in the job market.”

The need to distinguish between interns and volunteers is echoed by Lori Gotlieb, manager of community engagement for the Arthritis Society, and a consultant specializing in volunteer programs.

“One key piece for internships is learning,” says Gotlieb, “and another is that they have a beginning and an end. Internships do not go forever.” When they do, she states, it begins to blur the line between interning and volunteering, and it could also signal that an intern is functioning in place of staff. “As managers of volunteers, we gauge that,” she says. “I spent many years in different organizations representing volunteers to the staff, gauging what is appropriate and what is not.”

Having such a staff member, who oversees internship programs, is one of the best ways to make sure things run correctly. “There should be somebody there who is the voice of the interns and volunteers to make sure that they are not being asked to do things they shouldn’t be doing,” she says, “and staff have to be trained to know what is appropriate.”

Making it work

Toward that end, setting job descriptions at the outset is crucial. “The key piece of any internship or volunteer program is role descriptions,” says Gotlieb. “The reason is to give you the opportunity to define what the job’s parameters are, so that everyone knows what the expectations are. It is also used to evaluate performance.”

The strongest internship programs are designed around what an organization can offer to the interns, says Gotlieb. “You want to be able to teach a method of doing business,” she states, “so that even if the interns don’t end up working for you, they end up learning best practices based on the organization’s best practices.”

Ultimately, internships should strengthen an industry. If volunteering is about the individual giving to an organization, then ideally, internships need to be about the organization giving to the individuals. The intern’s job is to learn, and that learning can, and actually often should, inhibit an organization from performing at peak efficiency. It takes time and effort to teach. Organizations not willing to make that level of commitment, need to assess why they are taking on interns.

This is not to say that interns should not be asked to do work. As Gotlieb points out, if someone has never worked in an office before, even photocopying can present a learning curve. But in the larger scope, legislative parameters do exist that govern the use of unpaid labour, and it is in the best interest of any organization to become familiar with them, lest they find themselves on the wrong end of the law.

Shaun Smith is a journalist and novelist in Toronto. He was co-founder of the literary event series This Is Not A Reading Series, and he has written extensively about books and the publishing industry for such publications as The Toronto Star, Quill & Quire, The Globe & Mail and CBC.ca. His YA novel Snakes & Ladders was published by the Dundurn Group in 2009.

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