National Minimum Wage

Chapter 4: Compliance and Operation of the National Minimum Wage
4.43 We also heard from an internship recruitment agency,
Inspiring Interns. It matches graduates with employers
“Naturally some internships
offering internship opportunities. We reported in fall under NMW legislation and
Chapter 3 how Inspiring Interns believed that while it interns should be remunerated
was desirable for internships to be paid there would accordingly. However, we fear a
be a number of negative implications if employers had blanket application of NMW to
to pay the NMW for every intern placement; including
some companies stopping internship programmes.
internships will do more harm
than good to both interns and
4.44 We also heard again how internships and other unpaid companies.”
work had spread across a range of sectors. During one
of our London visits, Commissioners heard evidence
from Unite’s Parliamentary Branch as to how
internships were widespread in Parliament. It told us
Inspiring Interns evidence
work undertaken by interns often closely resembled that undertaken by those in salaried
positions. In the TV/film sector, one of those being targeted by HMRC enforcement, BECTU
contrasted properly managed opportunities with its experience of the part of the sector
where there was a constant churn of micro film-making businesses, and unpaid work was
sometimes championed, often using the rhetoric of ‘volunteering’ linked to vague promises
of creative fulfilment or a contribution to a CV. Equity highlighted institutions, such as film
schools, which relied on the exemption for ‘voluntary workers’ under Section 44 of the NMW
Act due to the fact that they were registered charities. Equity did not believe film schools’
use of professional performers to work for nothing on student films was compatible with the
intention of the Act. Tanya de Grunwald (GraduateFog) said in oral evidence that abuse of the
voluntary workers’ exemption had undermined the third sector’s image: it was using it as a
licence to obtain unlimited and unpaid junior support.
4.45 We raised our concerns in this area in our last report and recommended action by the
Government. It has responded and is addressing our recommendations. In evidence for this
report some stakeholders have urged further action to be taken. We judge that time should
be allowed for the new guidance to have an effect and for the targeted enforcement to take
place. However, we also note the continued evidence of the apparent breaking of the NMW
rules, including possible abuse of the voluntary workers’ exemption. In addition, we have
received initial feedback from some stakeholders on the revised guidance. While generally
welcomed, this has highlighted concerns which should be considered as part of our general
call for a revision of the overall guidance on the NMW (see paragraph 4.54).
4.46 We ask the Government to report to us on progress with its enforcement campaign in time
for our next report, and we will then be in a better position to judge whether further
measures are needed.
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