Are Unpaid Internships Illegal?

Unpaid Internship is in serious disrepute. Many economists and labour activists believe graduates shouldn’t be allowed to work for free. On the other hand influential people like Stephen Poloz, the Bank of Canada Governor, advocates that it’s not a bad idea for young people to do them. He says an unpaid internship is a valid way to avoid the “scarring” of long-term joblessness, especially among the Generation Y cohort.


In most cases, unpaid internships are in fact illegal in Canada. There are some exceptions however. Federal government departments and agencies have employed up to 1,000 unpaid interns since 2008, for example. In the United States the rules around intern compensation can be a bit more confusing. Nearly half the internships in America are completely unpaid. Currently Obama can employ hundreds of unpaid White House interns, even if he publicly advocates for higher minimum wage lol. Of course non-profit and charity organizations are allowed a free pass as can classify their unpaid interns as “volunteers.” 🙂

In 1947 the U.S. Supreme Court ruled that a railway company was justified in not paying its trainees during a 7 day training period before beginning their paid employment. The training was “for their own advantage,” the Court concluded. More recently, the Department of Labour has come up with 6 conditions that firms must meet in order to offer legal unpaid internships.

The youth unemployment rate (people under 25 years old) in Canada is nearly double that of the national average. I can see how companies can take advantage of unpaid interns. Working for free is not ideal because we need human labour to have value. But I can also understand how young people who are desperate for work experience would jump on any opportunity for free industry exposure, on-site experience, and at least something rather than nothing on their resumes. 🙂

Golly. I don’t know whether or not unpaid internships should be allowed. But it appears most policy makers and denizens of the internet say they’re not fond of the idea. 😕

Random Useless Fact:



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Renée (@nickelbynickel)
05/07/2015 10:58 am

Yeah I’m not a fan of them either, I feel they should be minimum wage or something at minimum. The point of spending money on education was to get ahead, not put in even more time going deeper in the hole. What was the point of education to begin with?

05/07/2015 11:47 am

I was an engineering student, so unpaid internships did not exist in my world. Everyone I knew was making an hourly rate equivalent to at least a $45K/yr job and in most cases much more than that.

I had several friends that did take unpaid internships because it was in areas everyone wanted to work (like my friend who interned on the Jerry Springer show). They said the experience was worth more than any amount of money. I am not sure I believe them, but they now do a lot of production work on TV shows, so I guess it was worth it.

05/07/2015 3:41 pm

Unpaid internships? Ridiculous. Shame on you all who take advantage of young adults with false promises. I hate them with all my heart.

05/08/2015 10:52 am

I’m willing to bet they wouldn’t be far off in saying 100% of their students get jobs AFTER graduating. If they don’t specify a timeframe, chances are everyone will be employed at some point. 😀

05/08/2015 4:55 am

I had an internship, but for 3 months, it paid the equivalent of $80k/yr. That was a sweet bump during my grad school days. However, most internships I applied to during my undergrad degree, were almost exclusively unpaid. Friends that are in radio start out interning unpaid, and “volunteer” a lot of time to try and land a paid gig later. I think they should all be paid to some degree though.

Finance Journey
05/08/2015 5:25 am

As Brian said, experience is worth more than money. I worked 4 weeks as unpaid interns (they called training session) at my company when I was studing at university, then became as 4 months contractor and got extensions for couple of terms and received a permanent letter with a decent salary after 2 years. I like my job as I have little freedom and work in my passion. (But still like fully freedom from day job and enjoy life 😀 )

Some of my friends are making much more than I make, but they really don’t enjoy the work they do. Lots of stress.

I am not againt the unpaid interns, it is a best way to gain some experience while looking a job, rather than sitting in sofa and dreaming about someone give you a job.
05/08/2015 8:56 am

I guess it really depend on the field of study. If you are in STEM, you usually have acces to a decent pay right off the bat.

If you chose a field where there is lot less jobs than the number of people who want them, you have to make sacrifices to get ahead of the others.

05/09/2015 6:40 pm

Well, I am in the medical field. I actually had to pay tuition while I was doing rotation. I did actual work, but my school had to be paid to have some one run the program, and pay the hospital to have us there. At the time, I had to work 60 hours (as an unpaid intern between coming early, spend the extra time to write patient case, and extra hours trying to get an edge), then worked on Friday, Saturday and Sunday at a paying job to support myself. I’m not opposing on unpaid intern as long as it’s qualifying intern position. I was very naive when I was first at the hospital, I shouldn’t get paid for the job that I didn’t know what to do. My mentors might get sued for my mistakes, so I guess it was worth it. On the other hand, if you are a writer, a coder, or work at a job where you already know what you are doing and they just purely taking advantage of you. Then you should be paid. It’s a fine line. The White House interns, they all said after working in the White House, their subsequent job… Read more »