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Are Australian companies exploiting interns?

UnderpaymentsJanuary 16, 2015

Are Australian companies exploiting interns? (Last Updated On: January 16, 2015)


An article posted this week in the Illawarra Times shames the Australian work culture, suggesting that we have a labour force problem and young unemployment issues. Unpaid internships are the underlying cause for these problems.

Young Australians entering the workforce are often unfortunately taken advantage of as young vulnerable workers. Employers who pay interns little or nothing for the experience of ‘getting a foot in the door’ can experience detrimental effects on their business should they be caught out for underpayment of staff or not meeting their obligations under The Fair Work Act.

The article names the sports broadcaster Crocmedia as “the most prominent” company who has underpaid interns. Crocmedia is currently in Federal Circuit Court over the underpayments of several workers. Gemma Smith, a 20 year old producer of radio programs, worked the grave yard shift, starting work as an intern at midnight or later and finishing just before dawn. Shockingly “in the six months she worked there, starting in August 2012, she worked as many as seven days out of 10 and she was paid nothing”.

Another Crocmedia employee, Jonathan Wilkinson, started work at age 23, he worked the same grave yard shift for 15 months. This time he was paid, however according to Wilkinson’s lawyers the “$2940, he was paid should have been almost seven times that amount”.

They say university life is the period in life where you are having the most fun. However Australian’s, on top of their timetables and exams, are completing “short-term student placements which allow students to accrue course credits for a term of work” these are more than likely to be unpaid and hence these students have a second job just to be able to afford amenities to complete all tasks. There is a struggle for many young people who intern to try and make ends meet. There is the argument that young Australians who are ‘well off’ are the only ones who can afford to work and gain experience for free.

On the other hand internships can be used by employers as a tool for recruitment. Michael Rice runs a financial services company in Sydney and he employs 60 people. He says by using interns he has found a ‘cheap recruiting tool’. Rice hires interns for $25 an hour and they work one or one and a half days a week. Rice says “at the end of a year, we know whether we might want to hire them and they know if they want to work for us. There’s good will on both sides”.

The most important aspect to decipher for an employer is whether the intern is just that, or are they considered to be an employee?

If the internship focuses on training, the worker is classified as an intern, however if the intern does the work of a regular employee he or she is considered to be an employee and should be paid the correct modern award for that particular role.

If you are an employer and currently have interns and you are unsure if you are following the correct employment obligations call Employsure today on 1300 651 415 of fill in the form below. Employsure can protect you against claims and ensure that you are covered when hiring and utilising interns.

*Information sourced via the Illawarra Times.

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