The central question when delving into the rights of interns revolves around their classification as ’employees.’ This significance arises from the fact that Irish employment legislation confers distinct rights exclusively upon those falling within the ‘employee’ category. Essentially, if interns do not fall into this classification, it suggests that they may not enjoy the same scope of employment rights and protections afforded to other workers. Therefore, the precise definition of an ’employee’ within Irish law takes centre stage in this matter, and this article will primarily focus on elucidating the employment status of interns.
The Intern’s Dilemma
To begin, it’s important to acknowledge that determining whether interns can be categorised as employees is a contentious issue in Ireland, and the answer is far from straightforward. There exists a spectrum of opinions within Irish jurisprudence, with some cases asserting that interns or individuals on work experience do not qualify as employees, while others argue the opposite. It seems the classification often hinges on various factors and the specific nature of the internship arrangement, which we will explore in detail below.
To provide context, it is helpful to look at the classic definition of employment status laid out in 1968 in the case of Ready Mixed Concrete v Minister for Pensions[1] which defines an employment relationship as one where “in consideration of a wage or other remuneration, the worker will provide their own work and skill in the performance of some service for their master.” This definition is not only outdated but also more complex than it might seem at first glance, and it has faced significant scrutiny in the courts over the years. In this article, we will deconstruct the interpretation provided by the courts and provide a clearer understanding of what this definition entails concerning internship scenarios in today’s world.
[1] Ready Mixed Concrete v Minister for Pensions [1968] 2 WLR 775
(A) Providing Work and Skill
There isn’t an abundance of legal precedent that precisely defines what it entails for an intern to offer ‘work and skill’ as outlined in this definition. Nevertheless, it appears likely that the question of whether interns provide ‘work and skill’ will eventually come before the courts for clarification.
Undoubtedly, there’s a valid argument that interns who primarily observe, shadow, or engage in training might face difficulty in demonstrating that they are indeed contributing “work and skill” or rendering a service. Nonetheless, it’s crucial to emphasise to employers that the requirement is only for them to provide “some service,”. This criterion sets a relatively low threshold. In essence, it seems that if interns can demonstrate that they offered any form of administrative assistance, there may be a valid argument that they did, in fact, provide ‘some service’.
(B) Consideration
In the case of ‘Ready Mixed Concrete’[1] , where this definition originated, Justice McKenna referred to the concept of “consideration” in the form of wages or other forms of remuneration. This certainly implies that if an intern receives a wage, they could indeed be considered an employee. However, it’s equally important to recognize that the absence of a wage does not automatically preclude an intern from being classified as an employee.
Interns who do not receive a wage, may still assert that they have received consideration in another form, in court. For example, it is well-established that benefits in kind such as stock options, paid education, paid accommodation or a company car, can also qualify as adequate consideration. This principle finds clear illustration in the case of Murphy v Focus Ireland[2], where the provision of accommodation to a volunteer at a residential institution was deemed “consideration in the nature of income.”
However, in spite of this precedent, the Irish courts are clear that an employer simply covering expenses of an unpaid worker, does not necessarily make them an employee if the sum of expenses does not constitute sufficient consideration. This distinction is evident in the case of Melhuish v Redbridge Citizens Advice Bureau[3]. In this case the contractual agreement stipulated that a voluntary worker would receive only expenses. The court’s decision in this instance concluded that this arrangement could not be categorised as a contract of employment. A pivotal element of a contract of employment is the provision of remuneration, and the court held that the arrangement in question did not meet this threshold. A 2021 decision by the Irish Labour Court case of Camphill Communities of Ireland v Williams[4] further reinforced this perspective, concluding that a volunteer, defined as an individual receiving no more than expenses, would not be regarded as an employee. Consequently, it seems that the Irish law is clear on the fact that an arrangement solely based on covering expenses was incongruent with the essence of an employment relationship.
In summary, according to the definition established in the case of ‘Ready Mixed Concrete,’’[5] The notion of “consideration” encompasses both wages and “other remuneration.” However, it’s crucial to emphasise that the concept of consideration does not encompass an employer covering expenses that do not meet the threshold of “sufficient consideration.”
[1] Ready Mixed Concrete v Minister for Pensions [1968] 2 WLR 775
[2] WRC, 8 Aug. 2022
[3] [2005] IRLR 419
[4] Labour Court, 7 September 2021
[5] Ready Mixed Concrete v Minister for Pensions [1968] 2 WLR 775
(C) Unpaid Internships without Expenses
It seems the natural next question is; What about an intern arrangement where there is neither expenses or wages?.
Such volunteer arrangements typically do not meet the “wage or other remuneration” requirement. Using the conventional principles this suggests that in the absence of consideration, there can be no contract of employment. This sentiment has also been corroborated Irish Workplace Relations Commission which held in 2021 that for the purpose of the Unfair Dismissal Act “work on an unpaid basis does not constitute employment.”[1] Nonetheless, some authorities support the notion that there may be a reevaluation of the “there must be wages” principle in Irish law in the near future.
Consideration, in classical contract law, is simply a benefit or detriment. Therefore, there is undoubtedly an argument, since internships often offer intangible benefits, such as valuable learning experience or networking opportunities, it could be considered as “consideration in the nature of income.”.
This idea has been put into in English law, where there has been an explicit challenge[2] of the concept that wages or remuneration are an absolute necessity for a contract of employment. The English High Court has held that consideration can take diverse forms, including access to office facilities, equipment, or benefits in kind. Such a precedent could potentially elevate the status of unpaid interns to that of employees. However, it’s crucial to emphasise that while English law is not binding on Irish courts, it frequently serves as a persuasive authority. Therefore, even though this precedent doesn’t directly apply to Irish law, it is likely to be taken into account by Irish courts in their deliberations.
Another persuasive example is the 2022 Labour Court case of Soltan v Shannons Solicitors.[3] In this instance, Ms. Soltan worked as an intern and received a ‘stipend,’ with no formal employment contract in place. After missing several payments, she sought to enforce her employment rights under the Terms of Employment (Information) Act, 1994. Here, the employer’s argument rested on the absence of a formal employment relationship, citing the informal nature of the agreement and the absence of ‘wages.’ Nonetheless, the Labour Court concluded that Soltan should be regarded as an employee entitled to employment rights. This case underscores the possibility that interns, even when technically unpaid, could potentially access various employment rights and protections. Furthermore, this case also suggests a leaning of Irish courts towards aligning with the English precedent of broadening the interpretation of what constitutes consideration, as previously discussed.
[1] Migrants Rights Community Organisation Coordinator v A Migrant Rights Organisation, WRC, 19 July 2021
[2] See case of Knight v Secretary of State for Business [2014] IRLR 665
[3] [2022] 2 JIEC 2105
