Unpaid Work Rules In New Zealand: Internships, Trials And Volunteering

You’re trying to grow a small business, and an extra set of hands can make a huge difference.

Maybe a student reaches out asking for an internship “for experience”. Maybe you want to run a short trial shift before hiring. Or maybe a friend offers to “volunteer” on your busy days.

This is where things can get tricky. New Zealand’s rules around unpaid work can catch well-meaning business owners off guard, because the label you use (intern, volunteer, trialist) isn’t what decides whether someone must be paid. What matters is the reality of the relationship and the work being done.

Below, we’ll break down the key unpaid work rules in New Zealand from a business owner’s perspective, including practical ways to reduce risk, protect your business, and still create legitimate opportunities for people to learn and contribute.

What Are The Unpaid Work Rules In New Zealand (And Why Do They Matter For Small Businesses)?

When business owners search for unpaid work rules in New Zealand, they’re usually trying to answer one core question:

“When do I have to pay someone, even if we’ve agreed it’s unpaid?”

In broad terms, if someone is performing work for your business and they look like an employee in practice, you generally need to pay them at least the minimum wage and provide minimum employment entitlements. Whether that’s the case depends on the specific facts and how the relationship works day to day.

Key laws and obligations that often come into play include:

• Employment Relations Act 2000 (the framework for employment relationships, good faith obligations, and resolving disputes)
• Minimum Wage Act 1983 (minimum wage must be paid where the person is an employee and the activity is “work” in an employment sense)
• Holidays Act 2003 (minimum leave entitlements for employees)
• Health and Safety at Work Act 2015 (you still have health and safety duties to people in your workplace, including many non-employees)

The risk isn’t just theoretical. If an unpaid arrangement is later treated as employment, you could be exposed to:

• claims for backpay (including minimum wage arrears)
• holiday pay and other entitlements
• penalties or enforcement action
• reputational damage (especially if the situation is shared publicly)

That’s why getting the structure right from day one matters-particularly if you’re relying on internships, trial shifts, or “helping out” arrangements.

Employee Vs Contractor Vs Volunteer: The Label Isn’t The Test

A common mistake is thinking “if we both agree it’s unpaid, it’s fine.” In reality, the legal test looks at what’s happening in practice, such as:

• Is the person expected to follow your instructions and your roster?
• Are they integrated into your business (like part of the team)?
• Are they doing productive work that benefits the business?
• Do you control how, when, and where they work?
• Is there an expectation of ongoing work?

If the arrangement walks and talks like employment, it may be treated as employment-even if the agreement says “unpaid internship” or “volunteer”. If you’re engaging someone as a genuine independent provider, it’s also worth getting the paperwork right with a Contractor Agreement.

When Are Unpaid Internships Lawful In New Zealand?

Unpaid internships are one of the most searched areas within unpaid work rules in New Zealand, because there’s a fine line between “learning opportunity” and “unpaid employee”.

There isn’t one single “internship law” that gives businesses a free pass to offer unpaid roles. Instead, you need to look at the substance of the internship.

Unpaid Internships Are Higher Risk If The Intern Is Doing “Real Work”

An internship is more likely to be treated as employment if the intern is:

• doing tasks that would otherwise be done by paid staff
• serving customers, producing saleable work, or contributing directly to revenue
• expected to hit targets, cover shifts, or fill roster gaps
• under close direction and control like a normal staff member

Even if the intern is enthusiastic and agrees to it, an arrangement that is effectively “work” for the business can create an obligation to pay minimum wage.

When Unpaid Internships Can Be More Defensible

While every situation depends on its facts, unpaid internships are typically more defensible where:

• the placement is genuinely focused on learning and observation
• the business is providing structured training and supervision (not just tasks)
• the intern isn’t filling a labour need for the business
• the placement is short, clearly defined, and tied to educational outcomes

If the internship is connected to a formal course (for example, a polytechnic or university programme), the education provider may have requirements for the placement structure. However, it’s important to remember that being “course-related” doesn’t automatically mean it can be unpaid-if the placement is set up so the intern is effectively providing productive labour under your direction, it may still be treated as employment. In any case, it’s smart to document the relationship clearly so everyone understands what the intern will (and won’t) do.

For structured placements, a Work Experience Agreement can help set expectations around supervision, learning objectives, safety, confidentiality, and the fact the role is not employment.

Practical Tip: Consider Paying Interns If They’re Contributing Output

If your “intern” is creating marketing content, handling orders, answering phones, or doing core business operations, it’s often safer (and simpler) to treat them as an employee and pay them properly.

That also means getting your Employment Contract in place so hours, duties, confidentiality, and termination expectations are clear.

Are Unpaid Trial Shifts Allowed In New Zealand?

Trial shifts can be a legitimate way to check whether a candidate can do the job in practice-especially in hospitality, retail, trades, and service-based businesses.

But trial shifts are also one of the fastest ways to accidentally create an “unpaid employee” situation.

A Trial Should Be A Genuine Assessment (Not Free Labour)

A lawful trial is usually:

• short (think hours, not multiple days)
• directly related to assessing skills needed for the role
• supervised, with someone actively evaluating performance
• limited in productive output (you’re assessing, not staffing a shift)

A “trial” becomes risky if it looks like the person is simply doing normal work that your business benefits from, especially if you schedule them during a busy period to “see how they go” and they end up covering real operational needs.

Do You Have To Pay For A Trial Shift?

It depends on what’s really happening. If the person is effectively working for your business (even for a short time) and the arrangement looks like employment in practice, they’ll generally need to be paid at least minimum wage. Many businesses choose to pay candidates for trial shifts anyway, as it can reduce arguments later about whether the person was really an employee.

If you want to use trial periods in an employment sense (for example, a 90-day trial period after hiring), that’s a separate process with specific requirements and should be built into your employment documentation properly.

Health And Safety Still Applies

Even for very short trials, you still need to think about:

• site induction and hazard awareness
• training on any machinery, equipment, or safe processes
• appropriate supervision

From a risk management point of view, a trial shift is still “real life” work in your workplace, so treat it with the same care you would any other workday.

Can Someone “Volunteer” In My Small Business?

This is where unpaid work rules in New Zealand commonly trip up small businesses: volunteering is most common in charities, community groups, and not-for-profit organisations, but the key issue is still the true nature of the relationship. In a for-profit business, having “volunteers” regularly doing productive work can be high risk, because the arrangement may look like employment in practice.

Genuine Volunteering Usually Looks Like Community Or Charitable Work

Volunteering is typically unpaid work done:

• freely and without expectation of reward
• for a charitable, community, cultural, or not-for-profit purpose
• where the organisation isn’t trying to replace paid labour in a commercial setting

If you’re a registered charity, incorporated society, community group, or similar, you may be in a better position to engage volunteers. Even then, you should set expectations clearly, and a Volunteer Agreement can be a practical way to document the arrangement (including duties, health and safety expectations, confidentiality, and what happens if the relationship ends).

“My Friend Wants To Help Out For Free” (A Common Scenario)

In small businesses, it’s normal for friends or family to offer to lend a hand-especially at launch, during events, or in busy seasons.

But if your friend is:

• working set hours, on your roster
• taking direction like staff
• serving customers, handling money, or doing core business work
• doing this repeatedly (not just once at a community event)

…the relationship can start to look like employment. Even if everyone’s intentions are good, it can create issues later if the relationship changes or there’s a disagreement about what was promised.

If you genuinely need ongoing help, it’s often safer to:

• hire the person as an employee (even casually), or
• engage them as a contractor (if it’s genuinely a contracting arrangement), or
• keep the help truly occasional and non-operational, with clear boundaries

How Can You Offer Work Experience Or Training Without Breaching Unpaid Work Rules?

You don’t need to avoid internships or work experience entirely. The key is to design the arrangement so it genuinely fits the purpose-and to document it properly.

Here are practical steps business owners can take to stay on the right side of New Zealand’s unpaid work rules.

1. Decide What You’re Actually Offering (And Be Honest About It)

Ask yourself upfront:

• Is this primarily a learning experience (shadowing, observation, training tasks)?
• Or do we actually need labour to get work done?

If you need labour, the cleanest approach is usually to hire and pay the person. It protects you, it’s fair, and it avoids messy debates later.

2. Keep Unpaid Arrangements Short And Structured

The longer and more “operational” the unpaid arrangement becomes, the harder it is to justify as non-employment.

Practical ways to keep it structured include:

• clear start and end dates
• a written outline of learning objectives
• limits on tasks (for example, “observe customer service” rather than “run the till solo”)
• named supervisors responsible for oversight

3. Put The Right Documents In Place

For paid staff, you’ll generally want an Employment Contract in place that matches the role (and reflects whether they are full-time, part-time, or casual).

For unpaid work experience, a Work Experience Agreement can help define the relationship and reduce misunderstandings.

And if someone is genuinely a volunteer (usually in a community or not-for-profit context), a Volunteer Agreement is a sensible step to get clarity from day one.

It’s also a good time to review your internal behaviour standards and expectations with a Workplace Policy, because even short-term workers and placements can create workplace issues if conduct expectations aren’t clear.

4. Don’t Forget Privacy (Yes, Even For Candidates And Interns)

If you’re collecting CVs, storing interview notes, keeping copies of IDs, or holding personal details for interns and trialists, you’re handling personal information. That means you should think about your obligations under the Privacy Act 2020.

In many businesses, having a clear Privacy Policy is part of building good systems-especially if you collect candidate information through your website, email, or online forms.

5. Pay Particular Attention To These “Red Flag” Situations

If any of the following apply, it’s a sign you should slow down and get advice before proceeding unpaid:

• You’re rostering the person to cover busy periods.
• You’re relying on them to keep the business operating (even partially).
• You’re giving them KPIs, sales targets, or performance warnings.
• You’re extending the arrangement repeatedly (“just one more week”).
• The person is doing the same work as paid staff.

A quick check-in with an employment lawyer can save you significant time, stress, and cost later-especially if the arrangement is part of your standard hiring process.

Key Takeaways

• The unpaid work rules in New Zealand look at the reality of the relationship, not the label you use (intern, volunteer, trialist).
• If someone is doing productive work for your business under your direction and control, they may be an employee in practice and may need to be paid at least minimum wage.
• Unpaid internships are higher risk when the intern is doing “real work” that benefits the business, fills staffing needs, or mirrors paid roles (including where a course-related placement becomes productive labour in practice).
• Trial shifts should be short, genuinely for assessment, and not used as a way to obtain free labour; whether payment is required depends on the real nature of the arrangement, but paying for trials often reduces risk.
• Volunteering is most common in charities and community organisations, and using “volunteers” to perform ongoing productive work in a commercial business can be high risk.
• Documenting the arrangement properly (whether it’s an Employment Contract, Work Experience Agreement, or Volunteer Agreement) helps set expectations and protects your business from day one.
• Even unpaid arrangements can trigger health and safety and privacy obligations, so make sure your systems cover inductions, supervision, and personal information handling.

If you’d like help setting up an internship, trial shift process, or work experience arrangement in a way that protects your business, you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.