Interns can provide employers with extra hands on demanding projects, another individual to promote the company brand, the opportunity to “test-run” an employee to see if they have long-term potential in the organization, and much more! Internships can also be beneficial to young or inexperienced workers by providing them with a hands-on, practical experience in a professional environment prior to completing their studies or officially joining the workforce.
However, despite their many benefits, internships can create just as many questions, for instance:
- Are interns considered normal employees?
- Do I have to pay them wages?
- What paperwork is involved in hiring an intern?
To help set the record straight, this article discusses best practices for Ontario employers bringing interns into their organization.
What do business owners need to know about internships?
Please note that the following information applies only to Ontario employers governed by the Ontario Employment Standards Act, 2000 (the “ESA”).The law applicable to internships vary by jurisdiction. Employers must consult the employment standards legislation and regulations applicable to their operation to determine whether, and under what circumstances, unpaid internships are permissible.
Comparing Paid & Unpaid Internships
Internships can be divided into two categories: paid and unpaid. Under Ontario’s ESA, not all interns are classified as employees, which means they are not necessarily entitled to receive the same benefits as employees. The difference between paid and unpaid internships is explored below.
How do unpaid internships work?
Unpaid internships mean the intern is not recognized as an employee for the purpose of the Ontario ESA and therefore is not entitled to the minimum standards provided by the ESA, including minimum wage requirements. If the intern is an individual listed below, they qualify as an unpaid intern:
- The individual is a secondary school student who performs work under a work experience program authorized by the school board that operates the school in which the student is enrolled
- The individual performs work under a program approved by a college of applied arts and technology or a university
- The individual performs work under a program that is approved by a private career college registered under the Private Career Colleges Act, 2005 and that meets criteria prescribed by regulation
- The internship is intended to provide the individual with practical training for certain professions excluded from the ESA, including but not limited to law, medicine, accounting, architecture, and dentistry
Other than the above scenarios, unpaid internships are illegal for Ontario businesses regulated by the ESA.
How do paid internships work?
If an intern does not meet the criteria listed above, they will be considered an employee under the ESA and entitled to all ESA rights and benefits, including minimum wage, overtime pay, and being limited to a maximum of 48 hours of work per week. An intern should be paid if they are being trained in a skill that other employees in the organization are using.
As with other employees, it is a good idea for employers of paid interns to ensure there is a written employment agreement in place setting out the terms and conditions of employment, including but not limited to the employee’s wages, hours of work, expected duration of the internship, and provisions for early termination.
Still have questions regarding interns in the workplace?
At Peninsula, our HR advisors can help you navigate the process of bringing an intern into your business. Our team can offer contract & documentation creation, HR consulting and online software to meet any of your HR needs.
If you are looking for superior HR services to help achieve your business goals, call our team of experts at: 1 (833) 247-3652.