I wonder what the government's consultation on unpaid internships means for employers

The way employers engage interns, volunteers and individuals undertaking unpaid work may be heading for significant change. The Department for Business and Trade has recently launched a consultation to examine how unpaid internships and similar arrangements align with National Minimum Wage (NMW) regulations. With the consultation open until 9 October 2025 and a response expected early in 2026, employers should take this opportunity to review their current practices.

The Purpose Behind the Consultation

At the heart of this initiative is a desire to address non-compliance with NMW laws, particularly where individuals may be working under the guise of gaining experience. The government is inviting feedback on a range of arrangements, including:

• unpaid or underpaid internships;
• work trials;
• voluntary work;
• volunteering; and
• work shadowing.

Current Legal Landscape: who is a 'worker'?

Although terms like “intern,” “volunteer,” or “work trial” are frequently used, they have no formal legal definition in UK law. Instead, the key concept is that of a ‘worker’, which is defined under the NMW legislation as someone who is either employed under a contract of employment or another contract where they personally provide work or services.

If an individual meets this threshold, they are entitled to the National Minimum Wage, unless a specific exemption applies. This means that regardless of how a role is labelled, the nature of the work actually being done will determine legal entitlements.

Implications for Internships

Internships are typically seen as a stepping stone for students or recent graduates looking to build experience. If an intern performs tasks that contribute to the business and is expected to work set hours or follow instructions, they could be classified as a worker and therefore must be paid at least the NMW. The government is particularly concerned about unpaid internships outside of formal education settings, which can limit access to career-building opportunities for those unable to afford to work for free. It has stated its intention to ban unpaid internships, except where they are part of an educational course.

The Grey Area of Work Trials

Employers may sometimes ask candidates to complete short tasks or attend unpaid trial shifts as part of their recruitment to determine whether the candidate is fit for the role. While these are not automatically unlawful, their legality hinges on factors like:

• duration of the trial;
• type and value of the work being done; and
• whether the trial is genuinely to assess suitability or used as a way to access free labour.

Employers should tread carefully because if the work resembles a regular job rather than a test of ability, the employer runs a high risk that the individual qualifies as a worker and is therefore entitled to NMW.

Voluntary Work and Volunteers: what is the difference?

The law distinguishes between volunteers and voluntary workers:

• Voluntary workers are often attached to charities or voluntary organisations and may not be entitled to NMW, provided specific conditions are met (such as receiving only expense reimbursements).
• Volunteers, on the other hand, generally fall outside the definition of ‘worker’ if they are unpaid and under no obligation to provide services.

However, the boundaries can blur between the two and the consultation seeks to understand how organisations engage individuals in these roles and whether there is any misuse of the titles in practice.

Work Shadowing: observation or contribution?

Work shadowing is typically understood to involve observing others without taking part in actual work. If that is genuinely the case, those shadowing will not be classified as workers and are not entitled to NMW.

The consultation, however, is keen to explore how this operates in practice and if individuals are performing tasks rather than simply observing which could put employers at risk of inadvertently breaching wage laws.

Why Employers Should Pay Attention

With the government signalling a tougher stance on unpaid work, it is essential for employers to ensure compliance and prepare for potential legislative changes.  

Practical Steps Employers Can Take Now

1. Audit Internships and Work Experience
2. Review all internship and work placement arrangements across your business. Look beyond the job title, assess what individuals are actually doing and whether they could be legally defined as workers.

Revisit Expenses Policies

If you do offer unpaid placements, consider reimbursing genuine expenses (travel, food, accommodation). Employers should be mindful of flat-rate payments as these may be seen as disguised wages and trigger NMW obligations.

Promote Social Mobility

Many large employers are focusing on diversity, inclusion and access to and in employment. Consider reaching out to schools in underrepresented areas, removing unnecessary experience requirements or expanding apprenticeship routes.

Looking Ahead

While we await the government’s response in early 2026, employers should take this opportunity to proactively reflect on their approach to reduce legal risk and help create a fairer and more inclusive workplace for all.

Need Expert Advice?

Whether you're reviewing your internship policies, planning work experience programmes or navigating tricky employment law issues, our Employment Law Team is here to help. Contact us on 02380 717 717 or email employment@warnergoodman.co.uk for tailored advice.

Discover Our Make Work Pay Programme

We’ve launched the Make Work Pay Programme – a fixed-fee, six-month service to help employers navigate employment law reforms, including the upcoming Employment Rights Bill. Learn more about how we can support your business. Learn more about our Make Work Pay Programme here.