27 October 2017

There was cross-party support in the House of Lords today for a ban on unpaid internships lasting over four weeks.

A Private Member's Bill brought by Conservative peer Lord Homes of Richmond sought to reverse the presumption when it came to employment status, so that all interns are considered "workers" and thus eligible for basic workers' rights such as the minimum wage after four weeks of service.

Currently, many interns who are not provided with the minimum wage would be classified legally as "workers" and therefore due payment, but the onus is on the individual to take their case to court and so the law is not being properly enforced.

As Lord Holmes pointed out: "As the current law is set out, there are many ways to avoid and evade the regulations. Perhaps even more problematic is that all of the onus is put on the individual — on the victim, if you will — to pursue a claim. How likely is it that someone who has undertaken an internship to try to increase their social mobility and build a career for the rest of their life will bring a case against an organisation?"

He also highlighted that the cost is too low for employers breaking the law and that this encourages them to bend the rules."If you fell foul of the current legislation, you could be compelled to pay the wages that you should have paid. That would hardly be a penalty; it would merely be a case of doing what you should have done in the first place. Will the Minister consider looking at penalties? A dramatic increase in penalties in this area would be not only appropriate but a very positive step towards ending this practice," he said.

The peer pointed out that unpaid internships are an issue affecting a significant proportion of young workers and the problem is getting worse. He pointed to a recent YouGov poll that found only 4% would be able to afford to take on an unpaid internship, yet other research indicates that unpaid internships have increased by 50% since 2010, and 30% of graduates have reported they have been forced to work unpaid for their current employer. In some professions, this figure rises to 50%. Labour peer Baroness Morgan of Huyton added that 67% of businesses take on interns.

Lord Holmes added that any business that cannot survive without using unpaid labour is not a good business model and so there are no economic or social mobility disadvantages to his Bill.

"If they are able to survive only on the basis of people working for free, with only 4% of the population of that age saying that they can undertake them and 40% having to turn them down, I do not think that that will be a great loss," he said.

Lord Mitchell suggested that unpaid internships bear some comparison to modern slavery as, although free to take or leave a role, the individuals are not paid for their work. Young people often also feel forced to work for free in order to get into their career of choice. "It is simply not fair that the quality of a CV is so stacked against those whose parents cannot pick up the phone and get them an internship," he said. "It is equally unfair that underpaid internships are taken by those who are already privileged."

The government has previously rejected the idea of banning unpaid internships because current employment law already states that those who fit the category of "worker" should be paid. However, as pointed out in the Lords debate, this rule is not being enforced and change is required.