Employers do not have to pay people who undertake work experience placement if certain conditions are met. For example, if a person is on a vocational placement as part of an education or training course, an employer may not have to pay them. In other circumstances, it may be necessary to first determine whether an employment relationship exists.
Employers are often approached by students seeking work experience. Employers may be open to providing real world experience provided that they don’t have to pay the person. However, employers do need to exercise caution because there are various factors which determine when employers must pay student participants and when placements can remain unpaid.
Employers can face underpayment claims if they do not fully understand the difference between legitimate unpaid educational experiences and those requiring payment of wages. Hear from our Employment Lawyer Brisbane on payment obligations for work experience.
Key Takeaways
- Not all unpaid work placements are legal under Australian law
- An employment relationship may exist even if the work is labelled “work experience”
- Students on formal vocational placements can lawfully undertake unpaid work
- Employers must assess whether the individual is doing productive work
- Misclassifying an employee as an unpaid intern can lead to Fair Work claims
When Are Unpaid Work Experience Placements Legal?
Vocational Placements Under the Fair Work Act
Under the Fair Work Act 2009 (Cth), a vocational placement is a specific type of unpaid placement that is lawful if:
- the placement is part of an authorised education or training course
- there is a formal arrangement between the host organisation and the institution
- the work is done as a required component of the course
- there is no entitlement to pay for the work performed
When is an Employer required to Pay for Work Experience?
If the work placement does not meet the criteria for a vocational placement, the arrangement could be deemed an employment relationship, meaning:
- the individual is performing productive work
- the business benefits from the person’s work
- the person is required to attend specific hours or meet performance standards
In these cases, the person may be considered an employee and entitled to minimum wages and entitlements under the relevant award or enterprise agreement.
Work Experience Placement and determining if an Employment Relationship Exists
To decide whether a person is a genuine volunteer or an employee, Fair Work looks at the nature of the relationship, not the title or label given. Key indicators of employment include:
- expectation of payment for the work
- the person contributes to the business and is not merely observing or learning
- control and supervision over tasks, similar to other paid staff
- duration of placement – longer placements often suggest an employment relationship
- even if someone is labelled as an “intern” or “volunteer,” if they perform duties similar to paid employees, payment may be legally required.
Unpaid Work Experience Requirements for High School Students
Each State and Territory has specific laws that deal with whether High School students need to be paid for work experience.
State/Territory | Legislation / Guidelines | Payment Requirement | Key Notes |
New South Wales | Education Act 1990 (NSW); NSW Dept. of Education Guidelines | Unpaid | For school students only; must be arranged through school |
Victoria | Education and Training Reform Act 2006 (VIC) | Minimum $5 per day (unless exempt) | Formal arrangement forms required; applies to school students |
Queensland | Unpaid | Only lawful if organised through approved school programs | |
South Australia | SA Dept. for Education Guidelines | Unpaid | Must be part of a school-endorsed program with insurance and risk protocols |
Western Australia | School Education Act 1999 (WA) | Unpaid | Applies to students in Years 10–12; Dept. of Education provides insurance |
Tasmania | Dept. for Education, Children and Young People Guidelines | Unpaid | Documentation and risk assessments are mandatory |
Australian Capital Territory | ACT Work Experience Program Guidelines | Unpaid | For secondary students; must include a signed agreement |
Northern Territory | NT Dept. of Education Work Experience Guidelines | Unpaid | For Year 10 and above; school arranges placement and insurance |
Employer Checklist for Work Placements
Employers should take the following steps before agreeing to unpaid placements:
- ensure the placement qualifies as a vocational placement
- limit the duration and scope of unpaid work
- avoid giving unpaid participants tasks that directly benefit the business
- maintain written agreements outlining the placement conditions
- regularly review arrangements with your employment lawyer
- legal Risks of Misclassifying Unpaid Workers
Failing to pay a person who is legally considered an employee can result in:
- underpayment claims
- Fair Work Ombudsman investigations
- fines and penalties
- damage to business reputation
Businesses have been penalised for disguising genuine employment as unpaid internships. For example, in Fair Work Ombudsman v Crocmedia Pty Ltd [2015], the employer was found to have engaged workers under sham arrangements, resulting in compensation orders.
How has Prosper Law helped manage Unpaid Work Placements?
Prosper Law’s employment law team have helped employers to identify whether they are required to pay for work experience placements. We have worked with companies in assessing the nature of the relationship, whether the arrangement is a genuine vocational placement and recording this in an agreement or form of acknowledgement by the student.
Where we have determined that the arrangement is not a genuine vocational placement, we have advised our clients on minimum rates of pay and working conditions. This has enabled our employer clients to make business decisions about whether to engage work experience candidates through paid placements.
Frequently Asked Questions (FAQs)
Can I host an unpaid intern if they are not enrolled in a course?
No, unless the person is a genuine volunteer (not performing productive work), they must be paid under the relevant award or minimum wage laws.
What if the student is learning but also doing real work?
If the work benefits the business and resembles that of a paid employee, they may be entitled to wages.
If the work benefits the business and resembles that of a paid employee, they may be entitled to wages.
High school placements are usually covered by specific state or territory education guidelines and may be exempt under vocational placement rules if properly arranged.
How long can an unpaid placement last?
There is no fixed limit, but longer placements increase the risk of it being classified as employment relationship. Short, clearly educational placements are less risky.
Can a business face penalties for unpaid internships?
Yes. If the Fair Work Ombudsman finds that an unpaid intern was actually an employee, the business may face back-pay orders and fines.
