An intern is not an employee, but someone who comes to a company or organisation to gain knowledge and experience.
Intern or employee?
That makes quite a difference. An employee must be paid at least the minimum wage and holiday pay; an intern, however, does not have to be paid at all. An intern is not protected against dismissal and does not have to be paid during sick leave. Interns do not need to be registered with the pension fund. Some collective labour agreements contain specific provisions regarding interns.
Payroll tax
The working relationship with an intern is not a employment relationship. However, income tax must be paid on the allowances received by the intern. This is because, for income tax purposes, the internship agreement is treated as a notional employment relationship.
Where the trainee receives only a reimbursement of actual expenses in addition to their training, this does not constitute a (notional) employment relationship. This is the case, for example, where the trainee receives only a reimbursement for business travel expenses (including commuting) of €0.19 per kilometre.
If the work placement allowance is paid to the school (or a fund set up by the school), it has been confirmed that this does not constitute a notional employment relationship. In this approval There are, however, certain conditions attached.
If your intern is from abroad, you may be able to exclude the internship allowance from income tax on the basis of a specific approval for foreign interns.
Education
In most cases, the trainee undertakes the work placement as part of a course of study. The fact that it is a work placement therefore stems from the three-way relationship between the school, the trainee and the host organisation.
However, the work placement does not have to be linked to a study programme. To ensure that the arrangement is classified as a work placement rather than an employment contract, the following conditions must be met in such a situation:
- the focus is on learning (as evidenced, for example, by the supervision provided to the trainee);
- the trainee does not occupy a full-time post;
- the work carried out by the intern has little commercial value (as an employer, you are not allowed to make a profit from the intern).
First and foremost, the placement must be designed to ensure that the intern learns something during the placement. In 2017, parliamentary questions were raised following reports that interns were being used as “cheap labour”.
Internship Agreement
It is, of course, advisable to set out the arrangements with the intern in writing. As we all know, paper is patient. What matters, therefore, is not what is set out on paper, but the actual circumstances under which the intern is working within your company.
Of course, VWG can take the hassle out of drawing up work placement agreements for you.
Work placement at VWG
Every year, VWG offers a range of work placement opportunities within the specialist areas we cover. Would you like to do a work placement with us? If so, please get in touch with us via werken@vwg.nl.