Unpaid fashion interns: What's the big deal?

We're sure you, like every other decent designer in the country, have a continuous line of young ones willing to take up an unpaid internship, just to get some of that very rare thing: actual experience in the fashion industry. However, in the last couple of years it seems every designer worth their ready-to-wear has been sued for not paying their interns. The list is long and illustrious, and includes Versace, Armani, Burberry, Ralph Lauren, Fendi and Gucci.

Sure, these houses are all overseas, but the law is similar at home. The Fair Work Act mandates that employers pay employees a minimum wage, with hefty penalties attaching to non-compliance. That's $54,000 for a corporation, or $10,800 for an individual (such as an HR Manager) involved in the contravention.

So what, you say. An unpaid intern is a volunteer not an employee, right? Alas, it's not that simple.

The problem arises where the line between passive observer, and active worker, starts to blur. The argument is that once the "intern" is performing "work", which someone would otherwise be paid to perform, they've tripped over the line into employee status and should be paid.

There are some exceptions. A vocational placement, undertaken as a requirement of an education or training course, is not employment. So you're safe with your year 10 work experience kid. Voluntary work for a not-for-profit is usually pretty safe too. But beyond that, having someone in the office doing work for free – even at their own request – is potentially getting you into danger territory.

For what it's worth, we also think it's wrong to exploit the desperation of others. Being a good corporate citizen isn't just about complying with the law.

If you have been using unpaid labour, maybe take another look at that; before the Fair Work Ombudsman does.

We do not disclaim anything about this article. We're quite proud of it really.