Employee or Student Learner? Managing the Risks of Providing Financial Support to Students Undertaking Work Experience

There are increasing expectations that Australian tertiary graduates will have developed practical ‘real-world’ skills through participation in work experience, internships or work-integrated learning (WIL). Many WIL opportunities are unpaid, often in an attempt to ensure the requirements of the ‘vocational placement’ exception from employment status in the Fair Work Act 2009 (Cth) are satisfied, or to try and avoid creating a contract of employment at common law. However, for a range of reasons (for example, altruistic, recruitment, reputational) a variety of stakeholders choose to provide practical and/or monetary support to tertiary students engaging in WIL. This support may be provided through bursaries, scholarships, or stipends (collectively, WIL studentships). However, if improperly designed or implemented, WIL studentships can have inadvertent legal consequences. This can include constituting consideration which contributes to the formation of a common law contract of employment or being considered remuneration which means the vocational placement exception in the Fair Work Act will not apply to the WIL placement. Ironically, this may obviate the legal reasons which encourage WIL to be unpaid. This article considers the labour law risks associated with WIL studentships. It then situates these risks in context, by presenting novel empirical research on the design of WIL studentships in Australia, and the extent of awareness among university staff of the legal risks associated with WIL studentships. Together, this analysis provides original insights into the degree of labour law risk associated with WIL studentships in Australia, how that risk is being managed, and strategies that can be used to minimise the chance of unintended legal outcomes.