Unpaid Work Experience: The End of an Era!
Posted on February 26, 2015
A recent decision of the Federal Circuit Court of Australia (FCCA) demonstrates that the days of employers adopting a lax approach to work experience employees are over.
Fair Work Ombudsman v Crocmedia Pty Ltd [2015] FCCA 140 related to alleged breaches of the Fair Work Act 2009 (the Act) with respect to two employees of Crocmedia, Mr W and Ms S. These employees came to work for Crocmedia after having initiated contact with the organisation seeking work experience in the media industry whilst completing their studies.
The Act contains some exceptions with respect to minimum conditions and entitlements where a worker is completing a vocational placement. A “vocational placement” is defined as a placement that is:
- Undertaken with an employer for which a person is not entitled to be paid any remuneration;
- Undertaken as a requirement of an education or training course; and
- Authorised under a law or an administrative arrangement of the Commonwealth, a State or a Territory.
Accordingly, workers who undertake work experience on their own initiative and whose work is akin to that being performed by paid employees will not be completing a “vocational placement” for the purposes of the Act.
In the current circumstances, the employees performed unpaid work experience for around three weeks before being employed by Crocmedia on a casual basis. During the casual period, the employees were paid the following rates:
Mr W:
- $75 per shift on Monday-Friday; and
- $80-$120 per shift on Saturday-Sunday.
Ms S:
- $75 per shift.
The failure to pay the employees for the initial work experience period amounted to a breach of the Act, so too did the employer’s failure to pay minimum wages to the employees pursuant to the Award for the subsequent period. As the monies paid to the employees had been characterised by Crocmedia as “expenses”, the employees were entitled to receive the full amount of the wages they should have been paid (in addition to the amounts already received), totalling $22,168.08 between them.
Further, the FCCA ordered Crocmedia to pay the following penalties:
- $12,000 for failing to pay minimum wages;
- $9,000 for failing to pay casual loadings;
- $2,000 for failing to pay in full, at least monthly; and
- $1,000 for failing to provide payslips.
The decision of the FCCA was concluded with the following remarks:
The arrangements for work experience interns are a difficult topic within employment systems. This case does not involve circumstances where, at the end of the day, the arrangement could, on any view, be characterised as ongoing work experience or an internship. Profiting from “volunteers” is not acceptable conduct within the industrial relations scheme applicable in Australia. In some industries, and the media sector is a good example, the popular appeal of the industry will lure many young people to seek any opportunity to obtain a toehold in the industry…
… there can be little doubt that the penalties are likely to increase significantly over time as public exposure of the issues in the press will result in respondents not being in the position of being able to claim that a genuine error of categorisation was made.
Please contact a member of Lynch Meyer’s Workplace Relations team if you have a query about vocational placements.
