The introduction of the new ‘Training Wage’ which begins across the UK on the day internships for students who have recently graduated, proposes a payment of £2.50 per hour to be paid to graduates.
Over one third (37%) of internships are unpaid at the moment, according to research by CIPD. The ‘training wage’ proposes a minimum wage for all graduates completing an internship. The CIPD suggest that this ‘training wage’ helps to mirror the input that interns make to a company, whilst also endorsing social movements by persuading those from poorer backgrounds to apply.
The planned, £2.50 wage, which is the same as the present minimum wage for apprentices, would be used to cover all interns and apprentices in spite of the industry or job post. Any vacancy which is advertised as an internship would routinely start a legal obligation by the employer to pay the £2.50 training wage over the course of the whole internship, in a bid to lower the complex issues surrounding young person’s pay whilst also encouraging improved enforcement plans.
There are several other recommendations made by the CIPD in their policy paper, such as: A new code of best practice, adding to the CIPD’s Internships that work: A guide for employers (published last year), should be generally distributed to employers in order to better the quality of programmes currently offered to young adults. Thought should be given to the working rights, such as sick pay, that working interns should be able to benefit from. Talks should be undertaken in regard to the option of regional pay differences that will reflect diverse living costs in particular areas of the UK.
Tom Richmond, Skills Adviser at the CIPD, comments: “The continued existence of a major loophole in the national minimum wage legislation has created a lot of confusion and concern around the issue of whether interns should be paid or not. We believe that the introduction of this Training Wage would reflect the contribution that interns make to their organisations, which is likely to be less than that of a fully-trained member of staff, at the same time as avoiding concerns over reductions in the number of internship opportunities that may result from all interns being paid the full minimum wage.
“Alongside the introduction of the Training Wage, a number of related issues would also need to be discussed, including which working rights interns should be entitled to. Nevertheless, the creation of the Training Wage would represent a significant step towards ensuring that internships promote social mobility, provide young people with valuable experience and help tackle exploitation in the workplace. What’s more, organisations would still be able to recruit young talent at a reasonable rate during this difficult economic period and beyond.”
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