Nice work, if you can get it

As the financial crisis in the UK becomes further entrenched, so young people face increased difficulties in accessing the labour market.  In March 2013, the BBC reported that the number of young people aged 16-24 without a job rose from 945,000 to 993,000 over just three months, taking the youth unemployment rate to 21.2%.  Professor Lynda Gratton of the London Business School, commented that

[of the] hordes of school and university leavers [who] enter into the global job market, the majority will become entangled in the financially draining, emotionally scarring, labyrinthine battle for employment.

She argued that “left untreated, youth unemployment is an issue set to destabilise fragile economies, become a breeding ground for extremism, and leave a generation permanently scarred.”  A bleak picture indeed.

We argue that youth unemployment in the UK will contribute to an increased vulnerability to exploitation.  Rising competition for jobs means that young people need more work experience on their CV; the job shortage means that this experience is more often than not gained through unpaid internships.  While unpaid internships may be nothing new, they have proliferated and now play a key role in enabling young people to access the job market.  Companies know that competition for internships is fierce and thus have interns over a barrel – you want the experience? Then you have to work (unpaid) for it.  Further, the incentives for young people to raise concerns about any ill treatment is limited – if you want to work in the film industry, for example, which often relies on word of mouth recommendations, why rock the boat by taking your employer to an employment tribunal and risk ruining your reputation before you have even started your career.

The law is clear.  The minimum wage is required for all workers over school leaving age (currently 16 years old).  While there are exclusions for individuals on work experience (usually a one week ‘taster’) or volunteering, these exclusions are only applicable to a small group of people e.g., those completing work experience as part of a higher education course.  Situations in which an intern has a contract and/or set hours means they are likely to be considered by an employment tribunal as an employee and thus should be afforded all relevant employment rights and pay.

In 2011, in Keri Hudson v TPG Web Publishing Ltd, the Central London Employment Tribunal found in favour of an intern – her “internship” at a website was in fact work.  She was entitled to £1,025 for five weeks’ pay at the national minimum wage rate and pro rata holiday pay.  The decision should have signalled a change in the approach taken by employers on the use of internships.  However, in mid-April 2013 it was reported that Jo Swinson, the Employment Minister, had referred 100 companies to Her Majesty’s Revenue and Customs for using unpaid interns in roles which were normally paid.  But this list was provided to the Minister by Intern Aware, which campaigns on this issue; they argued that this list that should not have to be provided by an NGO, rather, the Government should be taking a more robust and proactive approach to this issue.

For charities, the question of interns and volunteers is financially significant. As noted above, minimum wage regulations exclude volunteering at charities.  But where is the line between volunteering (through undertaking, for all intents and purposes, a role which should be paid) and an internship, which happens to be at a charity?  In other words, are those who undertake unpaid internships at a non-profit organisation discriminated against on the basis that their “employer” is a charity?  As the charity sector becomes increasingly professionalised, is there any basis for defining unpaid work for a charity as different from unpaid work for any other kind of organisation?

Internships in this sector have become pretty much mandatory, for both organisations and as a stepping stone to a career; most organisations want new employees, even those in entry-level positions, to have previous experience.  An excuse frequently cited by these organisations is that they are cash strapped and cannot afford to train inexperienced workers. This perspective seems ironic as all new employees, including interns, require some level of training.  In reality, this method is often used to get the “grunt work”, the photocopying, the filing etc., done for free, without having to pay an administrator.  But increasingly, organisations are diversifying the kinds of internships offered and asking for interns to provide direct services, submit policy consultations, offer legal advice – a whole of host of professional, more “substantial” roles.  If our argument is that all interns should be paid if they are doing work, does this hierarchy matter?  Is there a difference in value between these roles which could merit one kind of intern being paid and another not?  We would argue not, though perhaps only in the amount such interns should be paid: e.g. a legal advisor’s salary is usually higher than that of the office manager on the basis of the nature of the role and skill set required.

As competition for jobs in this sector increases, so do the number of unpaid internships.  There is a willing market of talented young people wanting to get experience.  When this is combined with the broader cuts in funding to the non-profit sector (from a reduction in government contracts to smaller grants from funders, whose pots of cash have been reduced by poor performance on the stock market), the result is that organisations are increasingly relying on unpaid labour in roles that would normally be paid.  Secondly, and following on from this, the non-profit sector business model has already been established on the use of unpaid labour.  As such, charities would undoubtedly argue that to suddenly pay these roles would be financially unfeasible, but to remove them would mean that organisations would be left operating at a much-reduced capacity.  These claims play on the idea that charities should somehow be considered a special case, exempt from the normal rules as they are “doing good”. An argument could be made that to remove the exclusion from the National Minimum Wage Guidelines for those volunteering for charities would mean that everyone who wished to volunteer for a charity would have to be paid, regardless of whether that individual wished to be remunerated.  Considering, for example, the army of retired people who give their time, by choice to charities, in areas such as the collection of donations, this would be financially unfeasible.

Also, are these not just really poor excuses that point to the inefficient administration of funding and a love of free labour? Charities need to recognise the role played by unpaid workers and account for such posts within funding applications. Moreover, we have seen the development of job adverts indicating that a role will start as voluntary and then may become permanent. This seems to be an excuse to get, say, six months of labour for the price of three, all the while dangling the carrot of permanent employment – a rare commodity for young people.  Even when organisations do receive million-dollar funding, they still use unpaid labour.  This seems particularly ironic in a sector supposedly committed to addressing issues like human rights violations, inequality, economic disadvantage, and exploitation.  It’s not just charities themselves; there should be an onus on funding bodies, foundations, trusts and even government, to acknowledge the use of unpaid labour and provide relevant funding to ensure this labour is financially compensated. At the very least, applications should include budget lines for the travel costs of volunteers.  Let’s stop pretending that charities do all of their work with paid labour and instead acknowledge that every charity is supported by at least one intern.

Though unpaid internships, and accusations of exploitation, may damage a business brand, this seems to be less of an issue for charities.  As the sector increasingly professionalises and becomes less distinguishable from for-profit organisations, this justification is further devalued.  Last time I looked, “doing good” didn’t pay the rent, an increasingly difficult challenge to meet as the cost of living steadily increases.

Should you wish to access some kind of justice for your perceived exploitation, the process can be challenging.  Interns may feel powerless in asking an employer for payment once an internship has commenced.  There is a risk to your reputation as well as the likelihood of being sacked.  The stories catalogued on Intern Anonymous often show a culture of intimidation which inhibits young people from taking action.  Many young people are unaware that their role may fall within the minimum wage criteria; pointing to a broader lack of education about employment rights.  Significantly, taking one’s case to an employment tribunal can be a daunting and time consuming process which will do little for future career prospects.  Not to mention the logistical hassle for job seekers: the average time from complaint to tribunal is 32 weeks.  The process is expensive, though individuals may quality for legal aid, the proposed changes to this provision, will potentially undermine access to legal advice.  The only hope seems to be increased enforcement by Government, and a cultural change by employers to this issue.  For example, Monster.co.uk, a recruitment site, announced last week that they would no longer carry adverts for unpaid interns.

Often neglected in the debate about exploitation are the grey areas and perceptions that underscore social acceptability of unpaid work. The value attached by a society to unpaid interns is arguably indicative of the acceptability of other kinds of exploitation. Interns themselves may not be trafficked or experience the worst forms of labour exploitation; but their positions are embedded in a larger social discussion about the cost of labour – who is deserving of payment and in what instances we are willing to make exceptions. Why is it acceptable to not pay young people for work as a trade-off for “experience”?  Is the value attached by society to unpaid interns indicative of the acceptability of other kinds of exploitation? And so thus, as the financial crisis deepens, the use of unpaid interns, as a method of propping up charities and businesses alike, seems to set to increase unless Government begins to take the enforcement of minimum wage requirements more seriously.