Bringing On Interns? Here’s Why You Need An Internship Agreement. (2026 Updated)

Hiring an intern can be a win-win. You get extra hands (and fresh ideas), and they get real-world experience that helps launch a career.

But there’s a catch: internships sit in a legal “grey zone” for a lot of New Zealand businesses. If you don’t set things up properly from day one, what you thought was a casual learning arrangement can quickly become an employment law problem - or a dispute about pay, hours, IP ownership, confidentiality, or even health and safety.

This article is a current, practical guide (updated to reflect today’s expectations around workplace rights, privacy, and modern working arrangements) on why an internship agreement matters and what you should include.

What Actually Counts As An Intern In New Zealand?

“Intern” isn’t a special legal category on its own. In NZ, the legal rights and obligations usually depend on the real nature of the relationship, not what you call it.

In practice, interns often fall into one of these buckets:

• An employee (fixed-term, part-time, casual, or full-time), where they’re doing productive work and you have direction and control over how it’s done.
• A volunteer (more common in charities/community organisations), where there’s genuinely no expectation of payment and the person isn’t filling a paid role.
• A work experience placement connected to a course or programme, where the primary purpose is learning and observation (and it’s structured accordingly).
• A contractor (less common for “interns”), where they run their own show and deliver services independently.

Most of the legal risk comes from accidentally treating someone like an “intern” while, legally, they look and behave like an employee.

Why Classification Matters

If the intern is effectively an employee, you may need to comply with:

• Minimum wage and wage and time record requirements
• Leave entitlements (depending on the arrangement and eligibility)
• Good faith obligations and fair process around performance/discipline
• Health and safety duties (these apply broadly in any case)

If you’re unsure which category fits, it’s worth getting advice early. It’s much easier (and cheaper) to set it up correctly than to fix it later when expectations have already formed.

Why You Need An Internship Agreement (Even If It’s Short-Term)

An internship agreement is your “ground rules” document. It sets expectations on both sides and helps you prove what was agreed if anything goes wrong.

Without an agreement, you’re relying on assumptions - and assumptions are where disputes tend to start.

It Helps Prevent “But You Promised…” Situations

Interns are often early-career and understandably keen. They may assume:

• the internship will lead to a job offer
• they’ll be paid (or reimbursed) for certain costs
• they can use company materials in their portfolio
• they can keep working flexible hours from home without formal approval

A clear internship agreement reduces misunderstandings and gives you a consistent framework for onboarding.

It Protects Your Business If The Relationship Turns Into Employment

Sometimes a short internship becomes a longer-term role. That’s great - but it can create legal confusion if you don’t document the transition.

Having an internship agreement makes it easier to:

• define the internship as a time-bound arrangement
• set review points (and make it clear that any job offer is separate)
• avoid accidental promises about ongoing work

If you decide to move them into employment, you should then issue a proper Employment Contract that matches the new role.

It Clarifies Who Owns Work, Ideas, And Content

This is one of the biggest “internship pain points” for modern businesses - especially in marketing, software, design, engineering, content creation, and product development.

If your intern:

• creates designs, code, copy, videos, or templates
• builds internal systems or automations
• contributes to product features or brand assets
• documents processes that become part of your operations

…you’ll want the agreement to clearly deal with IP ownership and usage rights (including portfolio use, if you’re comfortable with that).

Where appropriate, it can also help to align your terms with the principles you’d use for Intellectual Property ownership in other working relationships.

It Helps With Confidentiality And Data Protection

Interns often get access to sensitive information quickly - customer lists, pricing, supplier terms, marketing plans, or internal documents.

Your internship agreement should reinforce confidentiality, and where needed, include specific expectations about:

• using business devices and accounts (or personal devices)
• accessing customer information
• sharing work in portfolios or on social media
• returning and deleting information at the end of the internship

This sits neatly alongside broader workplace protections like a Confidentiality Clause and privacy compliance practices.

What Should An Internship Agreement Include?

A good internship agreement doesn’t need to be complicated - it just needs to be clear and tailored to what you’re actually doing.

Here are the clauses we commonly recommend considering.

1. The Purpose Of The Internship

Spell out what the internship is for. For example:

• skills development
• industry exposure
• a structured placement connected to a course
• a short-term project experience

This helps set the tone and keeps expectations realistic on both sides.

2. Term, Hours, Location, And Supervision

Be specific about:

• start and end dates (and whether there’s any option to extend)
• expected hours (and whether these are fixed or flexible)
• location (on-site, remote, hybrid) and any attendance requirements
• reporting line (who supervises them and approves work)

If you’re allowing remote work, it’s worth thinking about security and privacy in a practical way, not just a “policy” way (for example: account access, password management, and whether work can be saved locally).

3. Pay, Reimbursements, And Benefits (If Any)

One of the easiest ways to avoid disputes is to clearly document what the intern will (and won’t) receive, such as:

• hourly wage or stipend (if paid)
• reimbursements (travel, meals, software, phone)
• any perks (training budget, networking events)

If the internship is unpaid, you should be extra careful. “Unpaid” doesn’t automatically make it legally safe - it depends on the nature of the work and relationship (more on that below).

4. Duties, Learning Objectives, And Boundaries

Be clear about what kind of work they’ll do and what they won’t do. This helps you keep the internship appropriately scoped and reduces the risk of the intern being treated as a substitute for a paid staff member.

For example, your agreement might cover:

• the projects or departments they’ll rotate through
• what training will be provided
• what tasks require supervision or sign-off
• any restrictions (e.g. no client advice, no publishing content without approval)

5. Confidentiality And Information Handling

Your agreement should state that the intern must keep business information confidential during and after the internship.

In many businesses, it’s also worth requiring interns to follow internal policies and processes (for example IT use and document handling), particularly if they’ll have access to customer information.

If your business collects personal information (even something as simple as customer email addresses), make sure your privacy settings are consistent with the Privacy Policy you publish and how you actually operate day-to-day.

6. Intellectual Property (IP) Ownership And Portfolio Use

This is the clause that saves the most headaches later.

Your internship agreement should address:

• who owns IP created during the internship
• whether the intern can reuse templates or code snippets
• whether they can show work in a portfolio (and if so, under what conditions)
• how confidential or client-owned work is treated

Portfolio use can be handled sensibly (and fairly) with pre-approval requirements, restrictions on sensitive content, and clear rules about what can be published.

7. Health And Safety Expectations

Even if your intern is unpaid or only with you for a couple of weeks, you still need to take health and safety seriously.

Interns are often new to the workplace and may be less confident asking questions. Your agreement can reinforce that:

• they must follow safety instructions and report hazards
• they can (and should) raise concerns early
• they’ll receive induction and supervision relevant to their tasks

8. Ending The Internship Early

Not every internship works out - and that’s okay. What matters is handling it properly.

Your agreement can cover:

• how much notice is required (if any)
• immediate termination for serious misconduct (where appropriate)
• return of property, devices, and access credentials
• final pay or reimbursement calculations (if paid)

If the intern is actually an employee (or effectively one), the process matters. It’s worth being familiar with a fair employee termination approach so you don’t accidentally create an unjustified dismissal risk.

Paid Vs Unpaid Internships: What’s The Risk If You Get It Wrong?

It’s common for businesses to ask, “Can my intern be unpaid?” The honest answer is: it depends - and this is exactly where having a clear agreement (and the right structure) becomes important.

In general, the higher the level of control you have over the person, and the more their work looks like it benefits the business as productive labour, the more likely the arrangement looks like employment.

Signs Your Intern Might Be Considered An Employee

While every situation depends on the full context, some common indicators include:

• they’re doing work that would otherwise be done by paid staff
• they’re required to work set hours and follow your direction closely
• they’re meeting operational deadlines and output targets
• they’re integrated into your roster and business operations
• they have ongoing responsibilities rather than learning-focused tasks

If those features are present, you’ll want to consider whether you should be treating the intern as a paid employee with proper documentation.

Work Experience Placements (And Why They’re Different)

Many internships are really “work experience” arrangements. If the primary purpose is learning and the structure supports that (supervision, training, observation, limited productive output), it may be easier to justify the arrangement as education-focused.

In those cases, it can be appropriate to use a dedicated Work Experience Agreement instead of (or alongside) an internship agreement, depending on the setup.

The key is that your documentation and your real-world practice should match.

Common Internship Mistakes (And How An Agreement Helps You Avoid Them)

Most internship disputes aren’t caused by bad intentions. They’re caused by a lack of clarity - and a lack of consistency.

Here are some common traps we see, and how an internship agreement helps keep you protected.

Mistake 1: Treating The Internship Like A Trial Period For Employment

It’s fine for an internship to be a pathway into a job, but it shouldn’t be treated as an informal “try before you buy” employment arrangement without the proper obligations.

Your agreement should make it clear whether:

• there is (or isn’t) any promise of ongoing work
• any employment offer is at your discretion and subject to a separate agreement
• performance feedback will be provided during the internship

Mistake 2: Not Addressing IP And Then Disagreeing Later

Imagine this: your intern designs a logo variation, creates a set of templates, or builds a small code feature - and later wants to reuse it elsewhere, or claims they own it because they created it.

Even if you feel the answer is “obviously it’s ours”, that assumption can become expensive to argue about if it wasn’t documented. A well-drafted internship agreement can address IP ownership and permitted use upfront.

Mistake 3: Letting Interns Handle Sensitive Customer Data Without Safeguards

Interns often support admin, marketing, customer service, or research tasks - which can involve personal information.

To keep things compliant and sensible, your agreement can require them to:

• only use approved systems and accounts
• avoid downloading customer lists to personal devices
• report suspected privacy incidents immediately

This supports your wider obligations under the Privacy Act 2020, and it also helps protect customer trust.

Mistake 4: Using A Template That Doesn’t Match Your Reality

Internship templates are everywhere, but they often miss key details (or include clauses that don’t make sense for NZ businesses).

For example, you may need tailored terms around remote work, portfolio use, AI tools, device access, or specific IP categories - none of which are “one size fits all”.

If you want the agreement drafted properly from the start, an Internship Agreement prepared for your business can give you peace of mind that the document reflects how you actually operate.

Key Takeaways

• “Intern” isn’t a standalone legal category in New Zealand - what matters is the real nature of the relationship and whether it looks like employment.
• An internship agreement sets expectations on hours, supervision, duties, confidentiality, pay/reimbursements, and how the internship ends.
• IP ownership should be clearly addressed, especially if the intern creates designs, content, code, or process documentation that your business will use.
• Unpaid internships can create risk if the intern is effectively doing productive work like an employee - structure and documentation matter.
• Privacy and confidentiality aren’t optional when interns have access to customer data or sensitive business information, particularly in remote and hybrid setups.
• If the internship transitions into employment, you should issue a proper employment agreement and follow fair process if issues arise.

If you’d like help putting the right internship agreement in place (or you’re not sure whether your “intern” should actually be an employee), reach out to our team at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.