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A Three Step Solution for Tackling the Problem of Unpaid Internships in Ontario

Rumor around town is that the Liberals  in Ontario have plans to introduce legislation this week that addresses the ongoing controversy surrounding unpaid interns.  The Minister has said repeatedly that, while he is open to improving the model, the law as exists already deals with the problem of exploitative unpaid work.  While technically true, that is a rose-colored view of the law in my view.

I explained how the law deals with unpaid training in this post from 3 years ago. The problem with the existing law is: (1) it depends on a vulnerable trainee learning the law and having the gumption to instigate a legal fight against the very people

How Would You Regulate Unpaid Internships?

How Would You Regulate Unpaid Internships?

from whom she wants a reference letter; (2) the law is exceedingly complex and vague, which makes it easy to ignore and difficult to enforce in practice; and (3) the government isn’t able to proactively enforce the large numbers of workplaces that use unpaid trainees (at least without the injection of huge dollars). As I’ve argued many times before, the more complex an employment standards law, the less likely it will be effective.

A good question for employment law students is what could be done to improve the situation.  How would you change the law, if at all?  If I was asked this on a law exam, here’s what I might answer.

A Model for Addressing Exploitative Unpaid Training

A law that addresses unpaid interns should strike a sensible balance between two competing interests.  Firstly, we need to protect workers who are often young, desperate for work experience to help them get jobs, and vulnerable to exploitation due to a labour market that provides few decent jobs for workers with little job experience.  Secondly, there are good work experience training programs, and the law should not squeeze those opportunities out by a law that bans all types of unpaid training programs.

The present law does a poor job of balancing those interests.  It leaves far too much to the goodwill of businesses to learn and comply with the law, and places the burden of enforcement on the vulnerable workers.  That model is doomed to failure.  A new model is needed.  That model needs a system of oversight for trainee programs, and should include the following three components.

Step One:  End Unsupervised Unpaid Internships by Private Sector Businesses

Firstly, the loophole in the ESA that permits private sector employers to use unpaid trainees without any institutional oversight should be closed.  I’ve made this point in an earlier post:

One answer is to amend the law to repeal:  (1) subsection (c) of the definition of ‘employee’ in Section 1(1), which says that an “employee” includes “(c) a person who receives training from a person who is an employer, as set out in subsection (2)“; AND (2) subsection 2(2), which explains when a person receiving training is an ‘employee’. These two clauses together create an exception from the ESA for work that is similar to a training program from an educational institution, but that is not actually affiliated with an educational program.

The result of removing these two clauses would be that only training programs officially linked to a university or college program would be exempted from the ESA.  Thus, if a media company wants to use unpaid ‘interns’, it will need to hook up with an educational institution that offers a coop program in journalism or writing.  We would be left with Section 3(5)2, which says that a person is not an ‘employee’ covered by the ESA who, “ performs work under a program approved by a college of applied arts and technology or a university.”

Since one of rules to qualify for a lawful unpaid training program at present is that the work the trainee performs be “similar to that which is given in a vocational school”, why not just require businesses to hook up with a vocational school in the first place?  Colleges and universities are always looking for new experiential education opportunities. If there is no school that provides the sort of work the  company is  offering, then odds are the work would not qualify for the exemption in the ESA anyways.  A law that encourages businesses and schools to develop formal relationships would be easier to track and enforce, and would ensure that design of the training program is not left solely to private businesses which might not always have the student’s best interests at heart.

Step Two:  New Requirements on Colleges and Universities to Set Out Conditions of Unpaid, for Credit Training

Secondly, universities and colleges need to be more accountable in ensuring that the experience their students receive is vocationally valuable and not exploitative.   Work performed as part of an educational program is an extension of the classroom; businesses are providing a valuable public service.  The unpaid training  is not intended to provide businesses with free labour to perform work that would otherwise need to be done by paid workers.  To ensure that facilitators in colleges and universities understand their role, the law should require them to develop a Code of Conduct for unpaid, experiential training for credit.  That Code would then need to be submitted to the Director for approval, say every two years.  Since the schools know best what the training should comprise, the law should be flexible in this regard and let the schools decide.  However, the law should set out the basic framework of what the Code must include.  For example, it must set out a maximum hours of work in a week or semester (which the government could fix), it must indicate clearly that all occupational health and safety and human rights laws apply, it must describe the type of work that qualifies as vocational for the program in question, and it must provide instructions on how students can report problems.   The Code must be given to students and participating businesses, and the business must sign it. No student should be permitted to be assigned for an internship until the state has approved the Code and the business has signed it.  Educational institutions should be taking these steps anyways, this law would just formalize a process.

Step Three:  A New Authorization or Permit System for Unpaid Training Not Affiliated with an Educational Institution

Thirdly, not everyone who could benefit from on-the-job training is a post secondary school student.  There will also be  companies that want to offer valid, good unpaid training opportunities, but don’t want to associate with a formal college or university.  Therefore, there should be  an alternative system to the educational training model described in Steps One and Two. A new approval or permit system should be introduced for unpaid training opportunities not affiliated with educational institutions.

These employers can apply for a Ministerial or Director approval to permit the use of unpaid trainees.  The ESA already uses approval systems like this for such things as requests to exceed maximum hours in a week (Section 17.1) and overtime ‘averaging agreements” (section 22.1). In those instances, the government is acknowledging that it can’t trust agreements between employees and employers that essentially bargain around ESA standards, because workers are vulnerable to pressures to agree to whatever is put before them by the employer.  So it is with ‘unpaid training’ schemes. The approval would set out the rules for the work, ensuring that it meets the standards of valuable vocational training, set out limits on the number of hours that can be worked, require those rules be provided to the worker, and a provide the worker with a clear system for reporting problems.  In short, the state would play the oversight role that schools play in typical for credit coop programs.

In conclusion, then, my proposal is based on the following premise:  No business should be able to claim they have an agreement from a worker to work for free, unless either: (1) the state has signed off an approval after reviewing the proposal;  or (2) the work is part of a for-credit educational program supervised by a college or university, which has prepared a Code of Conduct confirmed by the state.

Issues for Discussion

Do you think this model would address existing concerns with the ESA treatment of unpaid internships?

What are it’s shortcomings?

Do you have a different or better solution?




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