Friday, 3 October 2014

The Results Are In - Outcome of the Ministry of Labour's "Blitz" on Unpaid Internships Announced

As discussed in an April blog post, the Ministry of Labour has turned up the heat on unpaid internships, in an effort to ensure that employers are not mischaracterizing employees as 'trainees'.  The Ministry's efforts included a spring "blitz", during which a number of employers' intern programs were scrutinized.  The Ministry of Labour has now released the results of the blitz on its website, and it appears that the news for employers is not all bad.
  •  Out of 56 inspections (in the advertising, public relations, computer systems design, consulting services and information services sectors), 25 employers had no internship program or no 'active' program.  5 employers had programs that did not contravene the Employment Standards Act, 2000.
  • 13 employers had programs that were entirely exempt from the Act.
  • 13 employers had programs that contravened the Act in some manner, resulting in the Ministry issuing 36 Compliance Orders and 1 Order to Pay Wages.
  • The Ministry identified the most common violations as relating to:
    • Minimum wage
    • Vacation pay
    • Public holiday pay  
    • Wage Statements
    • Record keeping
    • Hours of work
However, based on the release of this information, it is clear that there are still issues in this area.  When you remove the employers with no active internship programs, contraventions were identified in relation to 13 out of 31 programs (over 40%).  The fact that a large number of employers also did not have 'active' programs at the time of the blitz (17 employers) suggests that other non-compliant programs may have been shuttered before the Ministry started its campaign.

It is unlikely that this issue is going away, or that the Ministry will now cease its enforcement activities.  Employers contemplating running an internship program would be well advised to obtain some advice before heading down this treacherous path.  A good starting point is the Ministry's publication, "Are Unpaid Internships Legal in Ontario?" which explains the narrow circumstances in which an unpaid training opportunity can be offered.

Do you need guidance on whether to implement an internship program and how to navigate the requirements of the ESA?  Feel free to contact Lance Ceaser for more information.

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