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Work Experience – Paid or Unpaid

Work experience is an important part for students to traverse the divide between studies and work but the dilemma for businesses is whether that work experience student should be paid.  Although student placements should be meaningful and provide the student to expand and grow their skills it is not an opportunity for the business to take advantage and use them to replace a worker on leave.

The Fair Work Ombudsman outlines that unpaid work can take different forms including vocational placements, unpaid internships and unpaid work experience.  It is important to understand the distinction between work experience and performing the work of an employee.  To meet the requirements under the Fair Work Act 2009 (Cth) the following criteria needs to be followed:

  1. There must be a placement – the placement must be in line with the requirements of the course the student is taking, this can be arranged by the student or a facilitator.
  1. There must be no entitlement for pay for work undertaken – if an employment contract is agreed upon where the student is to receive remuneration for their work then the placement will likely have turned into employment.
  1. Placement must be a requirement of the course – work placement must be a component of the course the student is taking.
  1. It must be an approved placement – the institution delivering the course which the student is required to undertake a work placement must authorise the placement as work experience.

Indications to help decide if your student is actually an employee

The Fair Work Ombudsman provides five indicators on how to tell if a work experience student or intern is actually an employee:

  1. Purpose of the work experience – consider the purpose of the work experience, is the purpose to give a student work experience or to do work that helps with the ordinary operation of the business.

 Think:   the more productive the work the more likely the person undertaking the work is an employee.

  1. Length of time of arrangement – the longer the period the more likely the person is an employee.

Think:   if the period of time is longer than the education institution contemplated when setting the requirement to undertake work experience then it is more likely that the person is an employee.

  1. Is the work normally done by an employee – consider if the organisation needs the work done and if so would it normally be done by an employee.

Think:   is the work that the work experience student doing actually usually done by a paid worker, if so then they may be an employee.

  1. Expectation on student – even if the student is doing something productive they may not be expected to turn up or to even undertake productive activities.

Think:   the less likely the student is required to be at the business the less likely they will be considered an employee.

  1. Who is getting the benefit – the main benefit of the work should lay in the student not the business. If the business or organisation is getting more out of the placement than the student, then they are more likely to be an employee.

Think:   where does the main benefit lie with the student or the employer.

The information in this document, broadcast or communication is provided for general guidance only. It is not legal advice, and should not be used as a substitute for consultation with professional legal or other advisors. No warranty is given to the correctness of the information contained in this document, broadcast or communication or its suitability for use by you. To the fullest extent permitted by law, no liability is accepted by the publisher for any statement or opinion, or for an error or omission or for any loss or damage suffered as a result of reliance on or use by any person of any material in the document, broadcast or communication.

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