Are Unpaid Internships Illegal in Canada?

Answering the question of whether unpaid internships are illegal in Canada poses several problems.

First, labour law is generally a provincial matter and employment standards legislation varies from province to province. Second, there are no definitions of terms like “intern” in any employment acts and there seems to be a lot of misinterpretation or misunderstandings of current legislation.

Those interested in a good collection of research to date on the situation in Ontario, should check out lawyer Andrew Langille’s post on the topic.

In Ontario, a 6-point test borrowed from the American Department of Labour applies to determine whether an individual is an employee (and therefore subject to all the rights and protections of the Employment Standards Act), or not.  These criteria must all be met to classify an individual as a person receiving training. They must firstly actually be receiving training similar to that which they would receive from a vocational school, they must receive the primary benefit from the arrangement while the employer derives no direct benefit, the individual is not replacing paid employees, and it is clear that there is no right to employment or remuneration in order to not be considered an employee.

Exclusions are also provided for those receiving credit from approved educational institutions, as in co-ops or work placements. Quebec, Manitoba, and British Columbia also have language governing voluntary or unpaid labour, but research is still needed to truly understand how the legislation is being applied and what gaps exist across the country.

This past summer, the Ontario Ministry of Labour released a fact sheet on unpaid internships in an apparent attempt to clear up the matter. However, the practice appears to continue unabated and is perhaps growing as a result of the economic downturn, shifting demographics, and an economy increasingly based on precarious work arrangements.

Unfortunately, internsheep suspects that many young Canadians are falling through the cracks and are either shut out of opportunities due to an inability to work for free, or are being taken advantage of in exploitative work relationships.

Individuals concerned about their characterization as an intern can contact their provincial or territorial Employment Standards Office. The numbers are listed below. Be sure to also check out the tips over at Youth and Work – document as much of your work experience as you can, keep good records, and take action early.

Alberta: 1-877-427-3731

British Columbia: 1-800-663-3316

Manitoba: 1-800-821-4307

New Brunswick: 1-888-452-2687

Newfoundland and Labrador: 1-877-563-1063

Northwest Territories: 1-888-700-5707 (Canada wide)

Nova Scotia: 1-888-315-0110

Nunavut: 1-877-806-8402

Ontario: 1-800-531-5551

Prince Edward Island: 1-800-333-4362

Quebec: Labour Standards Office – 1 800 265-1414

Saskatchewan: 1-800-667-1783

Yukon: 1-800-661-0408 local 5944

Federally Regulated Industries: 1-800-641-4049

 

University Complicity in the Unpaid Racket

Today on Doorey’s Law Blog is a guest post by lawyer Andrew Langille on the topic: Generation Free: Are universities perpetuating inequality by promoting unpaid, precarious work? 

I commend the faculty and researchers of York for being willing to call out their institution on this issue. By posting unpaid internships, Internsheep believes that universities legitimize these roles as a necessary step for launching a career, while ignoring the barriers this system poses. We are in the midst of a paradigm shift in labour and universities have the potential to lead positive change in this area.

Internsheep believes that higher education institutions have a duty to protect their students and graduates from exploitative, illegal, and inaccessible opportunities. Unpaid positions that fall outside the scope of for-credit-co-ops should not be posted on university job boards. Further, universities are encouraged to adopt a policy of best practices for internships. Such codes have been put forward in theUKand could easily be adapted for the Canadian context.

Below is the last email I sent to Yorkoutlining more specific concerns with their listings and encouraging them to adopt a policy that actually addresses the rise in unpaid, exploitative positions. The email was sent September 14^th and to date no acknowledgement or response has been received.

Hi [York],

I appreciate your response.

 

While I agree that York students and graduates need to build career-related skills, the proliferation of unpaid work is worrying. A York scholar at Osgoode has recently conducted research on unpaid internships in Canada and has called the legality of many of these arrangements into question. This work hit the media earlier this summer.

Specifically, York listed positions from for-profit companies like RBC Financial and Sony Music. Justifying the unpaid nature of these positions in a legal context would be difficult, as direct financial benefit will be afforded the employer by these interns. Under the ESA, unpaid internships must provide training similar to that at a vocational school and the benefit must be to the intern, not the employer.

 

In addition to the legal dimension, these unpaid positions will inevitably only be accessible to those that can afford to work for free, creating a two-tiered entry-level system where the highly competitive positions are only for those of high socio-economic means.

 

Is York willing to assess these issues further? A voluntary code of best practice has been developed in the UK for internships, which could easily be adapted for the Canadian context. Adopting a policy that more specifically addresses the concerns posed by unpaid internships and misapplied volunteerships would ensure that quality, meaningful, and accessible opportunities are presented to York students and grads.

 

I’d very much be interested in York’s response to these concerns. Let me know if you require any additional information. Thanks again,

 

Carley

Youth Speak Up On Youth Unemployment

Today the Globe and Mail hosted a debate with young Ontarians looking for work on the topic: How would you create jobs for the young and unemployed in Ontario? Internsheep was there (post name: Carley Centen) and it was unsurprising that the topic of unpaid internships arose quickly (without us even bringing it up!).

Andrea Grassi: “[The government] should step in and try to resolve the issue of internships, which force new graduates and undergraduates to live like hobos (crippling social services over time and forcing greater debt). Some sort of subsidizing or tax break for these internships – that includes the private sector – should be proposed.”

Internsheep seconded the call for a temporary, stimulus tax credit for employers that create a full-time job for a  recent (within 2 years) graduate. Some felt tax incentives were a band-aid solution, but as a temporary stimulus program and used in concert with longer-term strategies, the high levels of youth unemployment at the moment need this urgent action.

It shouldn’t come as a surprise that internsheep also suggested amendments to the Employment Standards Act as a part of the solution, where unpaid internships could firmly be outed as illegal with employers subjected to stronger oversight.

Carley (Internsheep): @Jennifer: I am looking for a party who will make a statement on how they are going to target youth unemployment. To date, it’s been blanket promises with trickledown assumed for youth. This will not work. Concrete things that can be done are to offer a tax incentive to create a full-time job for a recent graduate and to amend the Employment Standards Act to define what an “intern” is and to crack down on illegal, exploitative unpaid roles.

Others echoed support.

Phill suggested: “Create useful incentives to boost hiring of *PAID* internships (the un/underpaid internship being almost criminal)”

Andrea Grassi:  “And – as I think unpaid internships are being abused – I agree with Carley in that, I would like to see the ESA examine these working conditions. All unpaid roles are exploitative.”

One dissenting opinion was voiced, from Lauren Friese, founder of TalentEgg.ca. TalentEgg is a career portal for recent grads and students in Canada. For full disclosure, it should be mentioned here that Lauren employs unpaid interns to create content for her start-up. Many postings on the site are also unpaid offerings. For more full disclosure, I have been a writer and editor under this scheme, unpaid. While it was overall a good experience and my pieces were often picked up by print publications offering me more exposure, the real benefit and exposure went straight to the organization. I digress…

Lauren Friese: “I think that a full out ban on any and all unpaid internships would have a negative effect on youth employment. While there are, of course, internships that are exploitative, there are also employers that offer unpaid internships in order to offer work experience to someone who has none.

For many employers, unpaid internships are a ‘nice to have’, not a ‘need to have’, and for those employers, banning unpaid internships would destroy the opportunity for students to get experience altogether.”

Happily, most young graduates in the conversation did not accept this logic, which relies on a false dilemma logical fallacy that I have yet to see supported with real evidence. (More on this argument in a future post) Refutations, after the jump.