Unpaid Work Experience (Prohibition) (No. 2) Bill

Nickie Aiken Excerpts

2nd reading & 2nd reading: House of Commons
Friday 11th September 2020 Commons Chamber

[Paul Scully]

The naming scheme is something that we did bring in, and we are keen to reinstate it—it obviously has been postponed at the moment—up to its full potential. We are working with employers and sending out tens of thousands of letters to employers to remind them of their obligations, but we will certainly be returning to the naming scheme in due course.

It is important that we recognise that internships offer an important opportunity for young people to gain experience and improve their career prospects, and that is why young workers tend to be more likely to accept unpaid internships. Minimum wage legislation provides for a number of exemptions that recognise the importance of gaining work experience. Those clearly defined exemptions include: students on placement for up to one year as a required part of a UK course of further or higher education; pupils of compulsory school age; participants in certain Government programmes to provide training, work experience or temporary work; and, voluntary workers volunteering for a charity or voluntary organisation. All other internships are likely to constitute work for minimum wage purposes, with the individual entitled to be paid at least the minimum wage.

[Nickie Aiken (Cities of London and Westminster) (Con)]

Does the Minister agree that it is important from a work experience point of view to consider younger children? When I was leader of Westminster City Council, I introduced the Westminster Lions scheme, which targeted 13 to 15-year-olds. That was about giving them experience not necessarily in the office, but of talking to employers and sectors about potential career opportunities for teenagers, ensuring that they could make the right career choices as they went to college and further education.

[Paul Scully]

I commend my hon. Friend for the work that she and Westminster City Council have done in this area, because it is so important to give opportunities. I will talk a little bit about social mobility, which is the point of what she did. Certainly on this side of the House, we like to remind ourselves that we are the party of opportunity. It is all about creating opportunities and making sure that everybody in this country—whatever their background, their family situation, their housing situation, their gender, creed or race—can grab hold of those opportunities and fulfil their potential.

That is why the Government share the concern expressed by organisations such as the Social Mobility Commission and the Sutton Trust, to which the hon. Member for Stockton North referred. Unpaid internships are a barrier to social mobility, for the reasons that he gave. I am also aware of the Sutton Trust report “Pay As You Go?”, which was published in November 2018. It recommended legislative changes to ensure that all internships longer than four weeks require payment of at least the national minimum wage.

In some sectors, such as the creative industries, unpaid internships have been seen as a key step to gaining experience in order to secure paid employment. However, the Government are clear that internships must not be used as a pretext to avoid paying qualifying workers the minimum wage, and that is why the Government’s focus has been on enforcing existing minimum wage legislation that protects workers’ rights to receive at least the minimum wage from day one.

Matthew Taylor considered unpaid internships in his review of modern working practices published in July 2017. He agreed that exploitative unpaid internships that damage social mobility in the UK should be stamped out. However, he argued that should be done by clarifying the interpretation of the law and by encouraging enforcement action by HMRC. He also argued that a separate intern status in employment law was unnecessary as the law was clear as it stood.

When enforcing the national minimum wage regulations, HMRC inspectors will consider the precise details of each case, such as internships or work experience, including what the worker is being asked to do. As I have indicated, entitlement to the minimum wage depends on whether someone is a “worker” in defined terms. Being a worker depends essentially on whether there is a contract—written or oral and expressed or implied—to work or perform services for a reward.

Most internships or work experience placements are likely to constitute work, as there will be some form of legal consideration, in that the parties have each agreed to do something or to provide something. On the employer’s part, that could include expenses, the promise of an interview or the promise of future work. Where HMRC comes to the view that arrangements constitute work under the minimum wage regulations, it will require the employer to repay any arrears to the worker and it will impose a penalty for underpayment. Even though interns are not defined in minimum wage legislation, they are generally already protected as workers and therefore already entitled to be paid at least the minimum wage from day one. It does not matter whether an individual is described as an intern or as on work experience; they still have that entitlement from the day they start.

That leads me, in the two seconds I have left, to the Bill.