The Walrus and Toronto Life, two high profile
Canadian magazines, recently shut down their internship programs
after a Ministry of Labour investigation concluded that the
programs contravened the Ontario Employment Standards Act
(the "ESA"). The Ministry issued compliance
orders for violations of several standards, including a failure to
pay the interns minimum wage. Canadian Geographic and
Rogers Publishing have since followed suit, also ending
their unpaid internship programs.
The news will likely be filled with similar stories over the
next few months as the Ontario Ministry of Labour has announced
that it is conducting an employment standards enforcement blitz. from April to June 2014 focusing on
unpaid internships across a variety of sectors. Sectors known for
their use of unpaid internship programs such as marketing/public
relations, software development, retail, media, film, and
entertainment will be inspected through a proactive enforcement
blitz to ensure compliance with the ESA.
As we noted in a previous blog
post, unpaid internships often run afoul of employment
standards legislation. In Ontario, the general rule is that all
interns must be paid and receive entitlements pursuant to the
ESA. This general rule is subject to two strict
First, the ESA does not apply to work performed under
an internship or co-op placement approved by a college of applied
arts and technology or a university. The second exception applies
where the intern is a "person receiving training" and
all of the following conditions are met:
The training is similar to that which is given in a vocational
The training is for the benefit of the intern. The trainee must
receive some benefit from the training, such as new knowledge or
The person providing the training derives little, if any,
benefit from the activity of the intern;
The intern's training does not displace the employees of
the person providing the training;
The person providing the training must not promise the intern a
job at the end of his or her training; and
The intern has been advised that he or she will not be paid for
the time that he or she spends in training.
Employers must be aware that simply calling a worker an
"intern" or "unpaid intern" does not shield it
from its obligations under the ESA.
In light of the blitz and the potential consequences of
non-compliance, employers may wish to conduct a review of their
internship programs to ensure compliance with the ESA.
Specifically, employers should verify that their internship program
either (a) meets one of the two narrow exemptions allowing unpaid
internships discussed above; or (b) provides interns with the same
minimum rights and benefits as employees in accordance with the
ESA. If the Ministry concludes that an unpaid internship
is illegal, it could result in an order to pay amounts such as
minimum wage, vacation pay or holiday pay that the individual
should have received had he or she been properly classified as an
employee under the ESA.
Possible Legislative Changes
Internship programs may soon face further restrictions. On March
4, 2014, a private member's bill known as the Greater Protection for Interns and Vulnerable
Workers Act was introduced. If passed, the Bill would deem an
intern to be an "employee" for the purposes of certain
sections of the ESA, such as records, hours of work and
eating periods, and leaves of absence. The Bill would also:
Require employers to provide interns with at least 2 weeks'
unpaid vacation after each completed entitlement year and to give
interns public holidays off;
Permit interns to takes leaves of absence;
Permit interns to file reprisal and other complaints to the
Ministry of Labour alleging violations of the ESA;
Require the employer to provide interns, in writing, with
information about their employment status and their rights under
the ESA, the terms of the their employment, and their
hours of work.
The Bill would unquestionably increase administration costs to
employers who engage unpaid interns. We will continue to monitor
the progression of this legislation going forward.
Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
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