This is a follow-up post to my previous post on a business perspective on unpaid internships in the United States.This post deals with more of a Canadian business perspective, and when it comes to internships in Canada, the regulations are anything but clear. There are currently no laws in Canada regulating internships specifically, so provincial employment standards acts are the only form of governance. For the most part, internships in Canada are paid, however in some sectors (media, PR, journalism) internships go often unpaid. In the United States, some candidates are actually paying employers for unpaid internships. Luckily in Canada, things haven’t gone that far. However, Canadians are still fairly unaware of what unpaid internships are all about.
Increasingly, Canadian courts have recognized an in-between class of agents that are not technically employees or not technically independent contractors. Over the past few years, our courts have come up with a hybrid category of agents called "dependent contractors." These are independent individuals who work so closely with employers, and whose relationship status with their "employer" is so sufficiently long-lasting, as to allow them entitlement for reasonable notice.
I just read a case coming out of the Tax Court of Canada that confirmed an intern working for a charitable organization was not an “employee”; rather, she was a scholarship recipient. Therefore, the organization didn't have to make any source deductions such as CPP and EI on behalf of the intern.