Work For Free: Employers hiring unpaid workers in ‘widespread practice’

Lauren Novak, political reporter for Adelaide‘s The Advertiser, revealed on April 10 the rife trend of employers preying on young people desperate for a job by allowing them to work either drastically underpaid or in many cases without pay, for up to a year.

The practice has prompted an investigation by the Fair Work Ombudsman.

Unions, academics and industry leaders have told The Advertiser the practice is widespread.

The problem arises in the first place because so many industries today refuse to employ tertiary-qualified graduates unless they already have experience: a paradox that has been allowed to spiral out of control and undermine practically any degree or qualification thanks to lack of legislation and relaxation of laws during globally tough times throughout the past decade.

Junior positions and internships were invented long ago to supposedly solve this “chicken or the egg” problem of experience over qualification. It’s no news that entry-level wages for those undertaking specialist study have always been tightly restricted.

However, experts at Adelaide University are about to deliver a damning report to the Fair Work Ombudsman this year that could very well prompt changes to federal and state laws.

Since the Global Financial Crisis crippled so many industries last decade, low-pay or no-pay working schemes have become big business. Overlooking minimum wage laws like this have gone epidemic in many countries, not just Australia:

Earlier this month, Intentious‘ Irish correspondent Keelan Foley revealed the “National Internship Scheme”, a trojan horse designed to take this practice to a whole new level in his eye-opening report “Ireland: The Slave Capital of Europe”.

“It is no longer customary to pay staff for their work in Ireland. It is accepted as part of the economic recession, paid jobs no longer exist and we should be honored to be given the opportunity to work regardless of pay. The situation has been turned on its head to the extent where job seekers have to grovel and beg, just so they can work for free in the hope that they may gain some ‘experience’.”

Many young adults don’t know their rights when it comes to pay, which makes it easy to take advantage of their naive skills.

“Young people are particularly vulnerable to these types of arrangements as they generally do not have a great deal of workplace experience … and they may be reluctant to speak up about mistreatment in the workplace,” Young Workers Legal Service co-ordinator Anne Purdy has said.

The extent of unpaid working arrangements, including internships, work experience, hiring for trial periods and junior positions are spread across almost all industries including hospitality, beauty, law, engineering, IT, media and teaching.

Some real examples uncovered are:

  • University students studying teaching who work for up to a year at a school without being paid, in the hope it will further a career.
  • Bar or hospitality workers who have worked unpaid for almost a year at a city venue.
  • Online advertisements for engineering firms offering three-month unpaid positions.
  • Law students undertaking unpaid clerkships at smaller firms while other students perform the same work for pay at larger firms.

One upon a time, the fact you had even been accepted into a tertiary course stood for something. It meant you got paid.

No longer.

Now, partial skill is clearly not even worth partial pay. In many cases, full tertiary degrees are not even worth entry-level pay, nor the right of being offered a job at all.

The message coming from industries is that while they recognise degrees build great employees, they are not prepared to pay for them. When given the option to hire a fully qualified employee with experience, companies are opting for the under/unpaid, inexperienced undergraduate. These exploited individuals do the same work, for none of the pay.

Thus, ironically, work experience itself, is becoming increasingly useless.

As Mr Foley points out, the situation in Ireland mirrors this:

“Although there are current limitations in place which regulate the amount of interns that can work for any one company and the internship period is limited to 9 months there is still more than enough room for exploitation and abuse.”

“The scheme is now accessible by any company, including fast food restaurants, bars and supermarkets. This in turn means that there now is a readily available army of high skilled cheap labour to be ‘used’ as a major cost saving device.”

South Australian Unions secretary Janet Giles said “there are [companies] out there who have been milking it … preying on the enthusiasm of young people to get into the workforce … there are instances where young workers have spent months, or even years, doing unpaid work that would ordinarily be undertaken by a regular employee.”

It surprises us that there are still no legal obligations for companies such as law firms or educational institutions to pay students undertaking clerkships, traineeships or industry experience placements.

In 2010, the Fair Work Ombudsman issued a specific warning about “allegations and anecdotal evidence of exploitation” of student workers in the legal profession.

Law Society president Ralph Bonig said that “it would be my expectation that people performing summer clerkships or a similar position would be paid, particularly if their employer was looking to charge out any of the work they did.” he said.

Opposition employment spokesman David Pisoni said the practice was “rife” in the beauty and hairdressing industries.

“They are notorious for trying people out without paying them,” he said.

“There are a number of businesses that believe because they may have had that arrangement with a work experience kid they believe they are entitled to offer unpaid work to everybody.”

If you feel that you or someone you know is underpaid, or working for no pay at all, please share your story or better yet, out your employer in the comments below.

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Categories: Business, Crime, Politics, Law

Author:Andrew Beato

CEO, Chief Editor and founder of Intentious. Passionate comment enthusiast, amateur philosopher, Quora contributor, audiobook and general knowledge addict.

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One Comment on “Work For Free: Employers hiring unpaid workers in ‘widespread practice’”

  1. Timothy O Shea
    April 17, 2012 at 7:59 pm #

    Reblogged this on

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