The Coalition government has launched its Youth Jobs PaTH internships program which it says will help reduce youth unemployment by allowing businesses to trial jobseekers for up to 12 weeks without incurring cost.

Under the program, the government will pay jobseekers aged 17 to 24 $200 a fortnight to participate in the internships. Businesses will be eligible to receive  $1000 in funding  when they take on a young person for a work experience placement and an additional wage subsidy of up to $10,000 should they elect to employ the intern.

The Government says that the program will help unemployed young people to obtain employment by taking the risk out of businesses taking on a new employee. Employment Minister Michaelia Cash said that the aim was to get 120,000 people from the ages of 17 to 24 to get practical experience in a business. However, the program has drawn heavy criticism from both the ALP and the Greens. While the ACTU President, Ged Kearney, argues that the program creates a perverse incentive for businesses to exploit young workers by churning through interns in order to benefit from the free labour and obtain the government handouts.

Unpaid work: what are your obligations?

Generally speaking, there are three circumstances where you can engage an unpaid workers or unpaid interns:

Vocational Placements:

A vocational placement is where the voluntary work experience is a requirement of a specific module or subject of a course (i.e. university course or high school work placement).

To be a lawful vocational placement, the placement must be unpaid. The placement must also be undertaken as a requirement of an education or training course and be ‘authorised’ under a law or an administrative arrangement of the Commonwealth, a State or a Territory.

Unpaid work trials:

An unpaid trial may be lawful so long as it involves no more than a demonstration of the candidate’s skills and abilities. This should generally be no more than one shift, or enough time for the employer to see if the potential employee possesses the skills for the job. The candidate should also be under direct supervision and must not be performing any meaningful work.

Unpaid work experience / internships:

Unpaid work experience or unpaid internships that do not fall within the exception for vocational placements are risky. For such an arrangement to be lawful, there must not be an employment relationship. What this means is, the worker must not be performing work for the company that would ordinarily be performed by an employee. If they are, they are likely to be deemed to be an employee and should be paid for their time.

For more information on the recommendations and what this means for you, clients should contact the HR Assured team. If you’d like more information about the benefits of becoming an HR Assured client contact us today for an informal chat.