In recent days, during a casual discussion with a couple of my friends, they mentioned that they are engaging interns who have completed their academics to perform duties alongside other employees. These interns are paid a stipend and work for periods ranging from 6 months to 1 year, which is common in various industries such as IT, service sectors, and manufacturing. Such interns are engaged by small, medium, and large organizations without understanding the compliance implications.
Many organizations engage interns or trainees for short-term projects to avoid paying minimum wages and social security benefits. Some companies engage interns or trainees for about a year, after which they are onboarded onto company roles.
Who are interns?
Indian labor or employment law doesn't define the term "interns." The real meaning of interns pertains to students who are part of academics, whether technical or non-technical. As part of their curriculum, they are engaged in organizations to gain exposure to job skills, depending on the course they are studying. This does not apply to individuals who have completed their course.
Can companies engage interns in organizations?
Yes, companies can engage interns as mentioned above. Such interns should be engaged according to the terms specified in their curriculum only.
Is a stipend mandatory for interns?
As students are gaining skills from their program, it is not necessary to pay a stipend. However, it is advisable to provide a reasonable stipend and have a detailed policy in place.
What are the checkpoints to ensure while engaging interns?
- Check if the person approaching for an internship is studying in any authorized institution.
- Mandatorily obtain a signed internship request letter from an authorized person at the institute, specifying the duration and purpose.
- Collect the resume along with copies of address proof, ID proof, and educational certificates.
- Provide necessary on-the-job training where possible and document the same.
- Upon completion of the internship, provide a certificate and keep a copy for documentation.
The legal/compliance considerations for engaging internships should be taken into account. Interns are not recognized under Indian labor laws, which may pose misclassification risks. Depending on the nature of arrangements, interns may be considered employees/workers under respective acts, leading to potential triggers of labor law benefits, social security benefits, compliances, and protections if correct practices are not followed.
The EPF department issued two circulars related to student-trainees, emphasizing compliance with guidelines to avoid non-compliances, affecting employee and employer relationships, and necessitating adherence to minimum wages, social security benefits, etc. Organizations looking to engage interns are advised to consider the training scheme under the Apprentice Act if not engaging academic students. Compliance with applicable labor laws is crucial to mitigate risks.
From India, Bangalore
Acknowledge(0)
Amend(0)
653Many organizations engage interns or trainees for short-term projects to avoid paying minimum wages and social security benefits. Some companies engage interns or trainees for about a year, after which they are onboarded onto company roles.
Who are interns?
Indian labor or employment law doesn't define the term "interns." The real meaning of interns pertains to students who are part of academics, whether technical or non-technical. As part of their curriculum, they are engaged in organizations to gain exposure to job skills, depending on the course they are studying. This does not apply to individuals who have completed their course.
Can companies engage interns in organizations?
Yes, companies can engage interns as mentioned above. Such interns should be engaged according to the terms specified in their curriculum only.
Is a stipend mandatory for interns?
As students are gaining skills from their program, it is not necessary to pay a stipend. However, it is advisable to provide a reasonable stipend and have a detailed policy in place.
What are the checkpoints to ensure while engaging interns?
- Check if the person approaching for an internship is studying in any authorized institution.
- Mandatorily obtain a signed internship request letter from an authorized person at the institute, specifying the duration and purpose.
- Collect the resume along with copies of address proof, ID proof, and educational certificates.
- Provide necessary on-the-job training where possible and document the same.
- Upon completion of the internship, provide a certificate and keep a copy for documentation.
The legal/compliance considerations for engaging internships should be taken into account. Interns are not recognized under Indian labor laws, which may pose misclassification risks. Depending on the nature of arrangements, interns may be considered employees/workers under respective acts, leading to potential triggers of labor law benefits, social security benefits, compliances, and protections if correct practices are not followed.
The EPF department issued two circulars related to student-trainees, emphasizing compliance with guidelines to avoid non-compliances, affecting employee and employer relationships, and necessitating adherence to minimum wages, social security benefits, etc. Organizations looking to engage interns are advised to consider the training scheme under the Apprentice Act if not engaging academic students. Compliance with applicable labor laws is crucial to mitigate risks.
From India, Bangalore
Acknowledge(0)Amend(0)CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.
Legal Compliance Plan.xls