Netherlands: Internship Agreements vs. Employment Relationships: Understanding the Distinctions

According to an investigation by the Labour Inspectorate, it has been established that 60 students undergoing vocational training at various institutions, while interning with the airline Transavia, ought to be classified as interns, should be considered employees with an employment relationship. This constitutes a violation of the Minimum Wage and Minimum Holiday Allowance Act (WML). Consequently, the Labour Inspectorate imposes a fine of EUR 46.000. In addition, outstanding wages and allowances totalling EUR 623.000 are being demanded. Be aware that internship agreements are not considered employment contracts.

 

Employment Contract

An employment contract is deemed to exist if there is a relationship of authority, the work is to be carried out personally, and the worker receives remuneration for his work from the employer.

 

Internship Contract

According to the Supreme Court, internships are required to include a clearly defined learning aspect. The activities carried out by the intern must predominantly be in the interest of the education that they are pursuing. As such, it cannot be classified as an employment contract.

To determine whether there is an internship agreement or an employment contract, there are several factors considered important:

• Learning should be the focal point during the internship period.
• The intern is guided by a mentor or internship supervisor.
• The student is enrolled at an educational institution.
• The student will only receive an internship allowance to cover expenses. However, this cannot be considered salary.

 

Conclusion:

In brief, it is crucial to prioritize a learning-oriented approach for interns and underscore this in the internship agreement. Make certain that the intern’s participation aligns with their educational curriculum, under the guidance of a mentor, and that the learning objectives are agreed upon in the internship agreement. This helps mitigate the risk of the intern being classified as an employee.

Key Action Points for Human Resources and In-House Counsel:

• Clearly define learning objectives in internship agreements. Emphasize that intern activities align with the educational curriculum to avoid being misclassified as employees.
• Review the internship agreements thoroughly to ensure they meet the conditions for an internship agreement.
• Differentiate between internship allowances. Interns should receive allowances to cover expenses, not remuneration for work performed.