COMMONPLACE PRACTICE IS  RISKIER THAN COMPANIES REALISE, EXPERTS WARN

What is going on with recruitment people?

All summer, we have seen national press coverage about the issue of unpaid internships, which are now widely agreed to be illegal (definitely in the private sector and probably in the public sector).

They are also unethical. Yes, unpaid internships can be good for a graduate’s CV — but that doesn’t make them right. These ‘opportunities’ exploit the desperate young workers who do them, and exclude those who can’t afford to do them.

In short, running unpaid internships is fast becoming become a very bad look for any company that claims to care about its reputation.

So why-oh-why am I still seeing so many advertisements for unpaid internships, pasted brazenly on every job board in the land — as well as on big brands’ own websites?

Who is placing these ads? Are they aware that these ‘opportunities’ are illegal – or at the very least unethical? Or do they simply not care?

Happily, there are signs that the tide may be turning and a new generation of socially responsible recruiters is emerging. That’s what the Graduate Fog Job Board is all about — I’ll only run ads for companies who have signed up to the ‘Good Guy Guarantee’, which includes a promise that ‘We do not use unpaid interns for placements exceeding 30 days.’ The board is small right now, but it’s growing fast and seems especially popular with SMEs (watch this space for new vacancies coming soon).

But Keith Robbinson, a well-known HR blogger and friend of Graduate Fog, says there is still far too much confusion among the industry about what is legal and what isn’t, when it comes to internships. He told me:

“I suspect most companies are not aware of the legal position – or believe that it is a ‘grey area.’ But, given that most corporates have large HR functions with lots of legal advice on most things, it does surprise me that the issue of unpaid internships seems to be a blind spot for so many firms.”

But Robbinson says ignorance isn’t the only cause of the current situation:

“First, many interns are so desperate to find a company that they go along with the situation — which makes it easy for firms to exploit the situation. Second, I suspect that it is often the business that takes on interns, without informing HR.”

He also admits that some companies are knowingly breaking the law when they take on unpaid interns, viewing this as a calculated risk:

“I’m afraid to say that I think many HR people know that unpaid internships are illegal — but because they know they’re unlikely to be prosecuted, they figure it’s a risk worth taking.”

So the general feeling seems to be that the recruitment industry’s conduct is the result of a mixture of confusion about the law and head-in-the-sand ‘ostrich’ behaviour about ethics.

But it isn’t just recruiters who seem confused. Those who award excellence in this field seem equally stumped about what’s right and wrong.

Take tomorrow’s National Online Recruitment Awards (NORAs), for example. A big deal in the recruitment calendar, the event’s website declares:

“The National Online Recruitment Awards were devised to recognise the very best in UK online recruitment, from the perspective of jobseekers themselves. The NORAs are primarily concerned with the value, service and protection afforded to the general public, in catering for their needs in an ethical, professional, secure and effective manner.”

And yet guess who’s up for two awards?

Yes, Inspiring Interns, the company that makes money by matchmaking employers and interns — and taking a £500 fee per month that intern works, while the intern earns only £200 per month. (Yes, that’s less than the NMW).

When I contacted Steve O’Donnell, organiser of the NORAs, about this, he wrote back:

Hi Tanya

Thanks for taking the time to email your concerns.  I very much appreciate your views, and understand the on-going issue regarding unpaid interns.

I should point out, however, that the National Online Recruitment Awards was setup to assess the only the websites of organisations, and not their business models.

We assess the online offerings of organisations in various categories, and do so from a candidate’s perspective. The initial stage of our process each year is where we invite nominations from jobseekers themselves.

If an organisation was found to have broken employment laws, or that their website was defrauding or misleading candidates, then we would compelled to consider exclusion.  As far as I know, these points do not apply in this case.

Thank you once again for contacting us.

Yours Sincerely

Stephen O’Donnell FREC
Director

Hm.

I was still confused.

But not half as confused as the good people of the well-respected industry title HR Magazine, which is one of the main sponsors of this year’s NORAs.

After all, back in the summer, the magazine printed this story in their very own pages:

“Employers who do not pay interns are breaking the law
2 August 2010

Employers who do not pay interns could face employment tribunal claims, according to a new report.

The report from the Institute for Public Policy Research (IPPR) and campaign group Internocracy on why interns need a fair wage spells out how employers almost certainly break the law with interns. Unpaid internships are common in politics, media and the fashion industry and enable young people to get a head start in their career.

The report points out employers mistakenly believe there is a ‘grey area’ around internships in the National Minimum Wage legislation and that they are allowed to take on unpaid interns so long as both sides know it is a voluntary position — but they are wrong. The law is in fact very clear and this is simply not the case.”

Er, so how exactly does this story fit in with companies like Inspiring Interns, who are nominated for two awards at an event HR Magazine is sponsoring?

I genuinely don’t have a clue.

(By the way, the NORAs are hosted by AllJobsUK.com and 1Job.co.uk and other sponsors include UKRecruiter, Barrelfish, OnlyMarketingJobs, Actonomy, Bullhorn, Inka Technology, HotLizard, Arithon, TheLadders.co.uk, iCIMS, CV Library, TribePad, Broadbean Technology and HB RIDA.)

Another HR blogger and friend of Graduate Fog has warned recruiters to tread carefully around the unpaid internships issue, as they are more exposed than they think they are.

Bill Boorman, founder of The Recruiting Unblog and Social Job Search, told me:

“Whatever the absolute truth about the legalities of unpaid internships, anybody involved with recruitment should be worried about them.

“Even if these placements haven’t been proved to be illegal yet, they’re close enough to the line to be potentially problematic in the future.

“Companies shouldn’t forget that once a successful prosecution is made, similar claimants can take legal action for placements that happened up to five years previously. In theory, we could see a sudden scramble of lawyers fighting to take on former interns as clients, on a no-win, no-fee basis. I think there’s potentially a lot of money to be made (and lost) here.

“Third party recruiters or agencies aren’t safe either. If they agree to handle a client’s role and that role turns out to be unlawful, the agency is liable.”

So what is Boorman’s message to recruiters?

“Think carefully before you take on an unpaid intern. Because it’s a bigger risk than you think.”

*Are you a recruiter?
Are you aware of the laws about unpaid internships? Do you agree that there is confusion about the legalities – or do you think the recruitment industry is knowingly ignoring the law to gain free labour from young workers?