Sep 2025 – Will a ban on unpaid internships make a difference?
One of Labour’s proposals to raise wages for workers is a long-awaited ban on unpaid internships. But when many interns should already be legally paid, will a ban be a material change?
Unpaid internships have been subject to media scrutiny for years. The previous Conservative government took some steps to target exploitative unpaid internships, but this fell short of any legislative action.
Back in 2017, a government sponsored review of working practices (the Taylor Review) recommended the government “stamp out” exploitative unpaid internships. Taylor’s view was that the existing laws around when interns should be paid were already clear and so he recommended more enforcement action taken by HMRC. The Conservative government confirmed that it would act on Taylor’s recommendation and, shortly after, HMRC wrote to over 500 businesses reminding them that interns should be classed as workers and paid the minimum wage.
Whilst this may have prompted some improvements, a BBC enquiry in September 2020 reported unpaid internships were on the rise again as a result of the pandemic. Labour have now put this issue back on the agenda as a way to improve social mobility.
What’s the deal with internships?
There is no legal definition of an internship or work experience. The terms can sometimes be used interchangeably, and an “internship” can be used as a label for all sorts of working arrangements.
An intern’s employment status is crucial; it determines what employment rights they will have. As we explore in our guide to different types of work contract, an “intern” is not a legal status. Depending on how an internship operates in practice, the intern could be an employee, worker or volunteer. The most significant implication is that only workers and employees are entitled to the national minimum wage.
Some forms of work experience or internships can lawfully be unpaid. For example, an intern who is work shadowing but not actually performing work will not qualify for the national minimum wage. But if an intern is required to carry out certain tasks or the intern is getting some form of reward for work (including a promise of future employment), they are likely to be considered a worker and should be paid accordingly. The government is concerned that employers are not always treating interns in this way.
What will be the New Deal?
Labour’s New Deal says that they will “ban unpaid internships, except when they are part of an education or training course”. What Labour considers to be an “internship” and how any new law will be enforced is yet to be confirmed.
A call for evidence was launched by the government on 17 July 2025, seeking evidence and views on unpaid internships (as well as other roles) that are unpaid or fall below the national minimum wage.
What could a ban look like?
It is unclear exactly how Labour will legislate for such a ban. Previous attempts to reform the law give us some insight into possible approaches Labour could take:
- A total ban.
Labour have said in no uncertain terms that that they will ban unpaid internships, unless the internship is part of an education or training course. How Labour define an “internship” in future legislation will be important. Previous pieces of draft legislation (which never progressed through parliament) have defined an internship as:- An employment practice where an intern “undertakes regular work or provides regular services” with the purpose of meeting learning objectives or to gain experience of working for that employer or to provide practical experience in an occupation; or
- “work-experience”, meaning “observing, replicating, assisting with and carrying out any task with the aim of gaining experience of a particular workplace, organisation, industry or work-related activity”. This is much wider and would arguably catch “work-shadowing” activities.
- A ban based on duration.
An alternative approach would be to ban unpaid internships or work experience which exceeds a certain duration. The previous draft bills referred to a 4-week timeframe. This approach might be perceived as Labour backtracking on the hard-hitting promise of a ban. However, the call for evidence does seek views on how long internships should last.
This would be a similar approach to that adopted by some of our European neighbours. For example, in Germany a voluntary internship must generally be paid if it is for longer than 3 months. Last year, the European Parliament voted to ban unpaid internships. Although this has been postponed several times, a tougher approach may be coming in Europe too.
How would a ban be enforced?
Although there have been media reports of unpaid internships for years, there are rarely tribunal claims or criminal prosecutions in practice. Enforcement will usually depend on individuals bringing a claim or reporting a breach, which interns may be more reluctant to do than permanent staff. Internships allow students or graduates to bolster their CV and enhance their professional experience. Interns will often have an eye on securing permanent employment or a positive reference and they are therefore in a particularly vulnerable position.
Exploitative arrangements may therefore be better targeted with more proactive enforcement. Labour have committed to establishing a new state enforcement agency called the Fair Work Agency. The Fair Work Agency will have powers to inspect workplaces, bring prosecutions and levy fines and it is possible internship arrangements could be under increasing focus.
What can employers do now?
Given there is already a national minimum wage risk to have unpaid working interns, we would expect most responsible employers to be largely unaffected by any ban in practice. Many employers have already taken steps to review their work experience and internship programmes to remove barriers to entry.
Whilst we wait to see what the final legislation will look like, here are some proactive steps employers can take now:
- Review your practices: Carry out an audit of all work experience placements or internships to understand what formal and informal work experience is offered throughout your business. It is important to dig behind the label and understand what type of work or learning is carried out in practice.
- Consider expenses: No matter how the government legislate for a ban, Labour’s intention is to improve social mobility and allow all talent to build their skills. Social mobility is increasingly on the agenda of large corporate employers. Even if a work experience period is lawfully on an unpaid basis, employers can improve access for all interns by covering necessary expenses such as travel, accommodation and meals.
- Broader focus on social mobility: Aside from expenses, other steps can help employers boost social mobility. Businesses could target schools in social mobility “cold spots” or consider broadening the entry routes into the business or the amount of required experience necessary before recruitment. One option to consider could include offering apprenticeships. During a work experience placement, employers could offer mentoring and networking opportunities, as well as CV support and interview practice.
If you have any specific questions you would like advice on or if you would like information about what is discussed in this article, then please contact: Abi.Frederick@lewissilkin.com of Lewis Silkin LLP.