National minimum wage (NMW) guidance on interns, volunteers and work experience

Employment status and guidance

Important: While using this guidance, consider each scenario separately and carefully. If you are in any doubt or have any questions, please speak to your HR contact. Any breach of the legislation could result in serious reputational damage for the Department and University.

Please note: A review of policy in relation to payment for volunteer / lay participants in research (including PPIE) is underway. Until this work is completed, please continue to progress payments as per usual department practice.

Please note that this information is in alignment with HMRC guidance and any uncertainty should be clarified prior to engagement.

A worker

A person is generally classed as a worker if:

  • they have a contract or other arrangement to do work or services personally for a reward
  • their reward is for money or a benefit in kind eg. voucher, the promise of a contract or future work
  • they have to turn up even if they don't want to
  • their employer has to have work for them to do as long as the contract or arrangement lasts
  • they only have a limited right to send someone else to do the work (subcontract)
  • they aren't doing the work as part of their own limited company in an arrangement where the employer is actually a customer or client

Departments should engage these individuals on a casual basis to meet a fluctuating demand for work or to cover a short, specific or one-off piece of work, providing it is for less than 12 weeks. This can be done through Dashboard or the Temp Pool.

Any questions regarding casual staff engagement should be directed to the:

An employee

An employee is someone who works under an employment contract and has additional employment rights and responsibilities to workers.

Generally at the University of York these individuals are on an open or fixed term contract and should be appointed through the usual recruitment process.

Any questions regarding recruitment should be directed to:

If you are unsure whether an individual will be a worker or an employee please review these options. Any questions regarding recruitment should be directed to your HR Partner or HR Advisor.

A volunteer or voluntary worker

A volunteer provides their services voluntarily.

Any activity that involves spending time, unpaid, doing something that aims to provide benefit other than, or in addition to, close relatives.

Unlike an employee or worker, a volunteer does not give their time or skills under contract, is unpaid and is not entitled to protection from employment law.

A volunteer may receive money to cover expenses but this must be limited to a minimal amount and aligned to any individual expenses incurred eg. food, drink, travel or any equipment needed to buy. This means that payment of a standard amount eg. £100 for all participants is likely to be unacceptable as this doesn't reflect the individual expenses and would not be deemed as a minimal amount.

Research volunteers

HMRC provide specific guidance in relation to research volunteers with the guidance being in line with the above ie. they will not qualify as workers nor will there will be a tax or NIC liability arising on the individual if the sums received do no more than reimburse the individual's reasonable costs of participating in the trial or research, including costs of travel and subsistence.

However should the sums paid exceed those reasonable expenses then they may fall under the definition of a worker and any excess may fall to be chargeable to tax as miscellaneous income, potentially giving rise to personal tax liabilities of the individuals which should be notified to the HMRC under self assessment.

Voluntary worker

A voluntary worker is a subset of a worker and is under a contractual obligation to provide the services for which he or she is engaged and undertakes work for a charity (eg. the University of York) voluntary organisation, associated fund-raising body or a statutory body, but is not entitled to monetary payments other than expenses and/or provision for subsistence.

Voluntary workers have a contract and they are entitled to the same rest breaks and holiday under the Working Time Regulations as employees (although holiday is effectively unpaid, as they do not receive pay on a working day). Unlike volunteers, voluntary workers come within the Equality Act 2010, so they can claim discrimination.

Individuals who participate in voluntary work at the University of York, or are engaged (have a contract) through the University of York, will need to provide a valid right to work. Individuals who require a working visa are also required to be booked through Dashboard.

Ways in which voluntary worker status compares to that of a volunteer or a worker:

  • Someone who works under contract (same as a worker, different to a volunteer)
  • Can be offered non-monetary subsistence (eg. food, travel expenses) and/or training, equipment, etc in order to carry out duties (same as a volunteer)
  • Does not qualify for the national minimum wage (different to a worker, same as a volunteer)
  • Is not entitled to protections from employment law (same as a volunteer)
  • The key difference between a volunteer and a voluntary worker is that a voluntary worker performs duties under a contract. A contract means mutuality of obligation — the organisation has an obligation to provide the work and the person has an obligation to perform the work. Contracts can be implied and/or created verbally; they do not need to be written down.

For voluntary workers the exception to payment of the National Minimum Wage is set out in The National Minimum Wage Act 1998 - section 44.

This area of the law is notoriously complex. It can often be unclear whether an individual qualifies for the NMW. For example, paying a voluntary worker in excess of their expenses (or reasonably estimated expenses) may take them out of the section 44 exception and confer worker status upon them, thereby entitling them to the National Minimum Wage.

To qualify as a voluntary worker, both of the following criteria need to apply:

  • No payment is made, except for expenses (eg. reasonable travel, accommodation or lunch expenses). If the individual receives a generic amount where specific expenses cannot be evidenced, or any other payment, reward (eg. vouchers) or benefit in kind they may be classed as a worker or employee.
  • The work is for a charity (such as the University of York), voluntary organisation, associated fundraising body or a statutory body.

Vouchers

If a volunteer or a voluntary worker receives any other payment eg. vouchers, this is deemed a payment. Where a certain value of voucher is provided to all participants eg. £100, this is unlikely to meet HMRC's direction as it is not related to the specific expenses incurred by the individual.

The University does not allow the use of vouchers to reward individuals who participate in activity at the request of the university on a voluntary basis with the one exception noted below.

Where we have vulnerable individuals who volunteer in research eg. sex workers, individuals addicted to certain substances or alcohol, who are unlikely to participate in research without some form of incentive and may not have a bank account or be willing to provide an address and the University may deem it impractical or irresponsible to provide a cash payment. In these circumstances the individual may be provided with a voucher however as noted above the value of the voucher must not be deemed to be anything other than a minimal acknowledgement of expenses/time.