Internship Contracts ? Have You Got Yours Right?

Most interns are students at a secondary school university or college or recent graduates. They complete an internship arranged between them, the educational establishment they are studying at and a company, a government department, such as a council office, or other organization. The term ‘company’ will be used throughout this article, even though the actual internship may not be limited to a commercial entity.

Although not required by law the time the intern is working for a company is usually covered by an internship contract. If you are an internship provider, i.e. you provide opportunities or are contemplating providing opportunities for an intern; you should know how to create an internship contract which is a very different document from an employment contract.

The difference between an internship contract and an employment contract

The man purpose of being an intern is to develop skills and learn about a profession by working within it. The main purpose of employment, from the point of the view of the employee at any rate, is to obtain remuneration in the form of wages or salary. The intern, in contrast does not expect to obtain any remuneration at all, although in many cases there may be arrangements made to reimburse the intern for any expenses that s/he has had to pay.

Employment contracts are usually required by law. They determine the conditions of employment including the period of employment, wages or salary, terms of notice, holiday and sick pay, etc. Internship contracts are not required by law. There is no requirement to pay the intern anything except possibly for expenses. There are no rules about dismissal or how an internship agreement should end.

What internship contracts should include

Internship contracts may be drawn up by the educational institution or by the company where the intern will be getting practical training. The contract should include the following:

where the intern will be working;the duration of training;the identity of the supervisor;the schedule for the intern;the training programme;details of reimbursement of expenses.Avoiding confusion between internships and employment

It is important for internship providers to avoid any sense of confusion or misinterpretation between an internship and employment. These misinterpretations are most likely if the provider is making internships available for the first time and erroneously provides a standard employment contract instead of a purpose designed internship contract. Part of the problem is that some businesses have also used interns to provide unpaid work, rather than provide opportunities to train and learn about a particular job.

This shouldn’t happen if there is good communication between the school or university and the business that is providing internship facilities and there is a good internship contract drawn up.

Basically, if the intern is doing work of any kind that could be done by a paid employee then they should be considered ‘employees’ and not ‘interns’ (2). Employees are normally protected by employment law and paid no less than the minimum wage. This does not apply to interns as the arrangement is for them to use the time learning and training, not doing the normal work done by employees.

There are some situations in which an intern is paid some kind of allowance rather than a reimbursement for expenses. If this is the case, then the status of the intern becomes a ‘notional’ employee. The intern then goes on to the payroll as payroll tax, national insurance contributions and an employer’s levy under the Healthcare Insurance Act.

There are also situations in which an intern completes a period of training and is then promised a job afterwards. There must then be a legitimate employment contract drawn up relevant to the job on offer. This must then comply with U.K. employment law as it has been amended effective January2019 (1).

Internships in other countries

Internships are available in most developed countries for the citizens of those countries. Each country has its own rules about interns but there is always a distinction between an intern and an employee. There are also internships available for international students and graduates, particularly in the U.S.A. While these may be called ‘internships’ they may also involve paid work. It is important for any person considering an advertised internship in the U.S. or another country not sponsored or organized by their own educational institution to look very carefully at the internship agreements on offer.

References to laws and articles

1. https://www.gov.uk/employment-status...choose

2. https://www.gov.uk/employment-rights-for-interns

Quote from UK legislation on interns and employment rights;