The Volunteer exemption: goldmine or landmine?

The Big Society pitch the government is making will rely on volunteers and voluntary workers.  The big problem is that very few people have a clear understand of the working criteria for ‘voulnteer’ and ‘voluntary worker’ exemptions.

Employers are creating positions that expose themselves and their companies (including local councils, charities, arts organisations and even Members of Parliament.)  They may suffer  HMRC payment orders, fines, public embarrassment and potentially criminal charges.

The ‘Volunteer and Voluntary Worker’ loopholes to NMW are suscinctly exploded by the MP’s Guide to National Minimum Wage. (That’s right, something truly useful has come out of Westminster!) Here is the House of Commons  ‘MP’s guide to National Minimum Wage‘ (If you want to dig a little deeper you can look at the report which most of this material was drawn: ‘National Minimum Wage and Volunteers’)  There is also very good advise for employers at Volunteering England: Volunteering and National Minimum Wage. Or in more depth, with test cases and everything at Volunteering England: Volunteers and the Law

It seems there has been controversy in Parliament in the last few years about NMW and the incorrect application of exemptions to ‘volunteers’ and ‘voluntary workers’.  Just like the ‘traditional’ unpaid culture in performing arts, the ‘traditional’ unpaid parlimentary intern culture is at odds with the NMW legislation.

So their guidance was written specifically to shine some light into the shadowy subject of volunteers/voluntary workers. And keep their members out of trouble.

So what in employment law are ‘volunteers’:

Volunteers are unpaid and have no obligation to work for the organisation concerned. They receive no expenses or benefits in kind… They are not eligible for National Minimum Wage, as they are not classified as ‘workers’ under the legislation.

This means that an actor who is obliged to take direction, deliver a performance, show up for specific calls, etc. cannot reasnoably be a volunteer.  There’s that classification is out the window.  Also, a copy of a film for the actors would be a benefit in kind and would also make this category non-applicable for actors.  And any sort of daily expenses or ‘profit share’ payments that fall short of paying NMW would also make this classification unusable. Honorariums are problematic.

What about the ‘voluntary worker’ exemption?

A voluntary worker, on the other hand, is someone who works for a certain type of organisation (i.e., charities, voluntary organisations, associated fund-raising bodies and statutory bodies) who receives no payment other than reimbursement for expenses incurred, subsistence and/or accommodation as is reasonable in the circumstances of the employment, and any training necessary to carry out the work. They may or may not have a verbal or written contractual obligation with the organisation… Voluntary workers are also not eligible for National Minimum Wage. Remember, they are not entitled to NMW as they are not defined as worker – they are not under any obligation to work for you and this must be made clear when recruiting and hiring…

Specific types of organisations can use this status. Charites, voluntary organisations, etc.  Production companies (incorporated or unincorporated) would rarely qualify for this status.  Again, any obligation to actually work for you, take direction, learn lines, meet a rehearsal or filming or performance schedule would make this category non-applicable.

If this is still unclear the definition of a worker is:

Workers are people who work under a contract of employment or a contract personally to perform work or provide services to another party to the contract (but not the genuinely self employed). Paid staff in the charity sector are eligible for National Minimum Wage as in the public and private sectors. It is not possible for any organisation to contract out of the statutory minimum wage obligations.

Section 1(2) states that a person qualifies for the NMW if he or she:

  1. is a worker;
  2. is working, or ordinarily works, in the United Kingdom under his contract; and
  3. has ceased to be of compulsory school age.

Section 54(3) defines a “worker”:  In this Act “worker” (except in the phrases “agency worker” and “home worker”) means an individual who has entered into or works under (or, where the employment has ceased, worked under)—

  1. a contract of employment; or
  2. any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual;

and any reference to a worker’s contract shall be construed accordingly.

So this really categorically chucks out these two exemptions.  Employers should be especially carefull of advertising using the terms ‘volunteer’, ‘voluntary worker’ or ‘volunteering’ unless the opportunity advertised clearly fits the criteria as described by employment law.

MP’s guide to National Minimum Wage. If you want to dig a little deeper you can look at the report which most of this material was drawn: ‘National Minimum Wage and Volunteers’

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