Volunteer opportunities, including unpaid internships and other unpaid work experience, allow individuals to gain valuable practical experience and make connections in professional fields they may be considering for future careers. However, these arrangements are not without risk.

While volunteers are not employees and are not afforded the same entitlements and protections as employees in relation to the work they do, the distinction can be blurred where they are treated in a manner more akin to employment. This can give rise to a risk of these volunteers challenging their status and claiming employment rights and entitlements, including recourse to the general protections regime under the Fair Work Act 2009 (the “Act”).

A recent decision of the Fair Work Commission highlights the difference between volunteers and employees and serves as a useful reminder for employers to ensure any volunteers within their organisation are treated as such, in order to mitigate the risk of successful challenge.

Background

The case involved a graduate lawyer who secured an unpaid internship with a Sydney-based law firm. He claimed he had been engaged by the firm as an intern with the expectation that he would build up to paid work. In support of his position, the intern relied on a social media post the firm had made which welcomed the intern to the “legal team” and business cards provided to him by the firm that described him as a “lawyer”.

After about four months of the internship, the graduate lawyer queried when he would start receiving payment and claims that the following day he received a text message from the firm’s principal which stated that he had decided to discontinue the internship. The intern challenged the decision, claiming that he was an employee and that the firm had contravened the general protections of the Act by dismissing him from his employment.

In response, the firm argued that the intern was a volunteer, not an employee, and that it had made no commitment to offer the intern paid work and nor had he gained any financial benefit from the internship. Far from deriving any benefit from the intern’s work, the firm claimed that his work required such significant rectification that it was actually a business cost.

In relation to the social media post, which the intern relied on as evidence of the firm’s intention to bring him on as employee, the firm said that it had welcomed him to the team so that he would not feel excluded. Similarly, the firm said that it had not referred to the intern as a “volunteer” on his business cards as it wanted to boost his self-esteem and avoid any embarrassment he might experience if given that title on the business cards.

Decision

The Commission acknowledged the value in having opportunities for genuine unpaid work experience and the benefits to the community from volunteer service, something the Commission said should not be “lost by characterising all time spent in a workplace as employment when the necessary elements of employment do not exist.” However, the Commission also recognised that it is not always easy to distinguish between volunteer arrangements and employment relationships.

Looking at the circumstances of the internship in the present case, the Commission found that the relationship “was one of work experience not employment”, while acknowledging that the parties may have had a mutual intention for the relationship to transition to one of employment at some point in future.

The following factors were key to the Commission’s decision:

• the intern was a trained and admitted lawyer and therefore it was not likely that he would have been ignorant of the nature of the internship or under any misapprehension that he was an employee;
• if the intern believed the relationship was one of employment, and that he was entitled to be paid as an employee, he would have provided his tax and banking details (which he did not do); and
• the internship was mainly for the benefit of the intern, not the firm.

Given the Commission’s view that the intern was not an employee, he was therefore not entitled to access to the general protections regime under the Fair Work Act 2009, and his application was dismissed.

Key takeaways

Unpaid internships, unpaid work experience and other volunteer work arrangements are not substitutes for paid employment, but will be upheld where the nature of the relationship is truly voluntary.  When considering the opportunity for a person to undertake work experience or volunteering within your business, there are a number of measures that should be implemented to reduce the risks of those volunteers successfully challenging their status.  These include the following:

• avoid making any statements to the volunteer that could create a legitimate expectation of payment, reward or future employment;
• use volunteer arrangements of fixed and short duration (for example, 2 – 3 months);
• ensure the arrangement is focused on experience, with an emphasis on training and learning opportunities;
• there should be no compulsion or requirement that the volunteer attend work; and
• the arrangement should be documented, and should be consistent with the voluntary and unpaid nature of the arrangement.  It should avoid using any language or concepts that imply employment.

People + Culture Strategies