Internship contract: tips and advice for HR

When a company wants to employ an intern, the question often arises as to which employment law regulations must be observed and what must be included in the internship contract or whether such a contract is even mandatory. Many employers are often uncertain about this. The employer can protect himself from possible claims made by the intern by means of a written, legally secure internship contract. Conversely, the contract also provides the intern with a certain level of security and explains his rights and obligations during the internship. Should there be any discrepancies or disputes regarding the internship, both the employer and the intern can rely on the contractually agreed conditions.

In this article, we go into more detail about the employment regulations for internships. We explain what types of internships there are, what legal implications arise from them and what employers must pay attention to if they want to draw up and conclude an internship contract.

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What is an internship?

According to the Minimum Wage Act (MiLoG), an intern is anyone who “undergoes a specific operational activity for a limited period of time in order to acquire practical knowledge and experience in preparation for professional activity, without this being vocational training within the meaning of the Vocational Training Act or comparable practical training” (Section 22 (1) p. 3 MiLoG).

An internship is therefore temporary by nature. During this time, interns should primarily acquire practical professional knowledge and gain insights into the working world and/or specific industries in order to prepare themselves accordingly for a job. This means that interns are part of everyday work life, but without being scheduled as regular workers for daily tasks. The tasks to be completed during the internship should primarily serve their continuing education.

German employment law regulates internship relationships. Important laws that employers must comply with in this context include:

• Minimum Wage Act (MiLoG)
• Vocational Training Act (BBiG)
• Civil Code (BGB)
• Working Hours Act (ArbZG)
• Occupational Health and Safety Act (ArbSchG)
• Dismissal Protection Act (KSchG)
• Evidence Act (NachWG)

Depending on the type of internship, the higher education laws of the respective federal states may also be relevant. There is therefore no law that exclusively regulates internships. It is therefore all the more important to conclude an internship contract before the start of the internship.

Note: The regulations presented here apply primarily to interns aged 18 and over. Underage pupils or students who complete an internship in a company must be treated separately by the employer in accordance with the Youth Employment Protection Act (JarbSchG).

What types of internships are there? 

Section 22 MiLoG differentiates between Compulsory and voluntary internships. The legal difference lies primarily in the intention with which the internship is carried out. Both types have different legal implications for both the employer and the intern.

Compulsory internship 

Compulsory internships are internships that are compulsory according to the study or examination regulations of a course or department of a (technical) university are in order to be complete studies. They can also be a part of school education (e.g. at general education schools, technical or vocational schools) or training at a legally regulated vocational academy. The internship or internship semester is therefore an important stage that the intern must go through in order to successfully complete their studies or training.

The legal basis for a compulsory internship isthe respective study or examination regulations of the relevant department or the training regulations as well as the internship contract. This means that, depending on the application, the examination board must recognize the internship after completion, which it usually does if the activities meet the requirements of the respective study or examination regulations.

As a rule, compulsory internships are completed before or during studies or training. The duration of the internship is often determined by study regulations or the school. From an employment law perspective, interns who complete a compulsory internship are not workers. Rather, they retain their status as students, as practical work is part of their education.

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Voluntary internship 

A voluntary internship, on the other hand, is usually done on ones own initiative and is not required by study or training regulations. Voluntary internships fall under the Vocational Training Act (BBiG) and concern interns “who are hired to acquire professional skills, knowledge, abilities or professional experience without vocational training within the meaning of this act” (Section 26 BBiG).

In other words, volunteer interns usually aim to

• supplement their theoretical knowledge with practical experience
• establish professional contacts
• increase their chances of permanent employment in the company
• acquire professional skills, knowledge and qualifications
• Get a taste of a job
• reorient themselvesself after a long break from work

The focus is therefore on acquiring new knowledge and skills, not on earning.

In the case of a voluntary internship, particular attention must be paid to the period for which the student or pupil is to be employed as an intern. Employment law distinguishes between voluntary internships of less than and over three months. Voluntary internships in accordance with Section 26 BBiG lasting longer than three months fall within the scope of the Minimum Wage Act (Section 22 MiLoG); The intern is equated to an employee under employment law. Depending on the duration of the internship, the trainee may therefore have minimum wage claims (more on this in the remuneration for internships section).

A written internship contract is therefore essential and provides an important legal basis.

What information should be included in the internship contract?

What the internship contract regulates in detail depends on the classification of the internship. This is because this results in different rights and obligations for the employer and for the intern. Unlike voluntary internships, mandatory internships are not covered by the BBiG. However, even in this case, it makes sense to draw up a well-drafted internship contract in order to clarify mutual rights and obligations (e.g. that the internship content complies with the study or examination regulations or the training regulations).

When drawing up an internship contract, the employer can refer to section 2 NachWG and Section 11 BBiG for orientation.

Name and address of both parties to the contract:

In the case of underage interns, the name and address of their legal representative must also be provided.

Purpose of the internship:

The internship contract must state whether it is a compulsory internship or a voluntary internship.

Content of the internship:

The learning and training objectives pursued by the internship should be clearly defined in the internship contract.

Duration of internship:

The contract must clearly state the duration, including the start and end of the internship, as this may result in further rights and obligations. For compulsory internships, it is important that the duration of the internship meets the requirements of the study or training regulations. As mentioned, employment law sets a limit of three months for voluntary internships. If the duration of the internship exceeds three months, the minimum wage law applies and the internship contract must be concluded in writing.

Duration of regular working time:

The employer must comply with the Working Hours Act when employing an intern and the Youth Employment Protection Act for interns under 18 years of age and accordingly include the daily internship period, i.e. the start and end of the working day, in the contract.

Payment and amount of remuneration:

If remuneration or an allowance is paid, this must be contractually regulated.

Compensation and compensation for overtime:

In the event that the intern exceeds the maximum number of eight hours per day, the contract should state how this is regulated (e.g. compensation of time off).

Important to know: Since compulsory internships are not covered by the minimum wage law, they are generally not remunerated. However, the employer can pay an allowance. Voluntary internships lasting longer than three months fall under the Minimum Wage Act and are therefore remunerated. The agreed remuneration covers an overtime of up to 10% in the number of hours worked per week, meaning that the intern does not receive any overtime pay. However, if the 10% limit is exceeded, the intern may be entitled to compensation for overtime from the employer if the employer ordered overtime or if it was necessary for operational reasons. This is then done by compensating with time off. Only if this is not possible will overtime be compensated monetarily.

Vacation entitlement:

Whether the intern is entitled to vacation depends on the type of internship. Due to their status, compulsory interns have no statutory vacation entitlement and therefore such a clause need not be included in the contract (unless the employer voluntarily grants a certain vacation entitlement). According to Section 10 (2) BBiG, the Federal Leave Act applies to voluntary interns, i.e. they are entitled to vacation provided that the internship lasts at least four weeks. With a five-day week, they are entitled to at least 20 vacation days per year, with the minimum entitlement calculated proportionally according to the duration of the internship relationship.

Duration of trial period:

Internship contracts may include a trial period. The duration is usually agreed individually and depends on the total duration of the internship. For example, for an internship period of three months, a trial period of two weeks is usual.

Termination:

Since a compulsory internship is usually a fixed-term internship contract, the termination options should be regulated in the contract. Due to automatic termination, ordinary termination is otherwise not possible. Voluntary internships have the same termination requirements as for vocational training contracts.

Reference to any applicable collective agreements, company and service agreements:

The contract must contain a general reference to any valid collective agreements, works and service agreements that apply to the internship relationship.

Tip: Does your company want to employ an intern and is looking for a legally secure template for an internship contract?Just contact the team at Twinwin! Twinwin offers a bilingual template for internship contracts, which you can individually adapt to the requirements of your company. In addition, twinwin's question and answer module provides reliable information on the various internship relationships.

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Internship contract: How is the probationary period regulated during an internship?

Since voluntary internships fall within the scope of the BBiG, a probationary period of up to four months is allowed (section 20 BBiG). However, in contrast to vocational training contracts, where the probationary period must be at least one month (section 20 BBiG), in accordance with Section 26 BBiG, the probationary period can be reduced to less than one month in the case of an internship.

As already mentioned, the actual duration of the probationary period for internship relationships is always based on the total duration of the internship and must be proportionate.

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When are interns entitled to a minimum wage?

When a company decides to hire an intern, the question is usually whether the trainee is entitled to an allowance. The employer must first differentiate between compulsory internships and voluntary internships and a duration of less than or more than three months.

In principle, since January 1, 2015, the employer is obliged to pay interns the statutory minimum wage (as of February 2024:12.41 euros per hour) in accordance with section 22 (1) MiLoG. However, there are several exemptions. In principle, the Minimum Wage Act does not apply if

• an internship is mandatory due to (tertiary) school law regulations, training regulations or as part of training at a legally regulated vocational academy
• An internship of up to three months serves as an orientation for vocational training or the start of a course of study
• an internship of up to three months is completed in conjunction with vocational or university training (if the intern has not yet worked for the company)
• The internship serves the so-called entry-level qualification in accordance with section 54a of the Third Book of the Social Code (SGB III) or vocational training preparation in accordance with sections 68 to 70 BBiG

Compensation for compulsory internships 

If the internship is a compulsory internship in accordance with Section 22 Paragraph 1 MiLoG, there is no legal right to remuneration and therefore no right to a minimum wage. According to a recent decision by the Federal Labour Court (BAG) on the minimum wage for the duration of an internship, this does not only apply to compulsory internships completed during studies. Even as part of a pre-internship, which is mandatory in the examination or study regulations as a prerequisite for taking up a specific course of study, the intern is not legally entitled to a minimum wage (Judgement dated 19.1.2022, Ref.: 5 AZR 217/21).

However, some employers pay their interns at least an allowance. This can not only have a positive effect on the employer's image, but also increase the chances of retaining well-trained interns within the company in the longer term. After all, the employer is signaling that he appreciates the intern's performance.

Important: Employers should read the study regulations to see how long the compulsory internship must last. If the study regulations specify a duration of at least 4 weeks, only these four weeks are considered a compulsory internship. Employers and trainees should therefore state in the internship contract whether the internship is free of charge or is paid below the statutory minimum wage.

Compensation for voluntary internships of less than and over three months 

With a voluntary internship, the entitlement to remuneration depends on the duration of the internship.

Voluntary internships less than three months are not subject to a minimum wage.

If an intern does an internship from more than three months, they are entitled to remuneration according to minimum wage, from the first day of internship. The employer must, therefore, pay the legal minimum wage. In this case, the employer must also pay social security contributions.

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Termination of an internship contract: What should the employer know?

Internship contracts are fixed-term and end automatically when the agreed internship period expires. However, it can happen that the chemistry between employer and intern is not right and one of the two parties wants to end the internship relationship prematurely. The information on the probationary period and the notice period in the internship contract is decisive in such cases.

If the intern in a voluntary internship is still in the trial period, the internship can be duly terminated both by the employer and by the intern without notice and without giving reasons (Section 22 (1) BBiG). This is also referred to as an ordinary termination for a limited period of time. For the termination to be legally binding, it must be made in writing.

Outside the trial period, the termination of internship contract is much more difficult. The options for termination are limited and are based on the legal regulations for the termination of vocational training contracts. In this case, the employer no longer has the right to ordinary termination and the notice periods for interns vary. According to section 22 (2) BBiG:

• both the employer and the intern may extraordinarily, without notice terminate the internship for good cause. For good cause means that there must be a serious breach of duty which makes it unreasonable for the employer or intern to continue the internship relationship (section 626 (1) BGB). Examples of gross breaches of duty include particularly serious misconduct such as theft or bullying at work. Important: The extraordinary termination without notice must be submitted within two weeks of becoming aware of the important reason.

• the intern can terminate the internship with proper notice with a notice period of four weeks.

In both cases, the termination must be made in writing and with the reasons for termination in order to be effective. If the employer and the intern agree that continuing the internship makes no sense for both parties and that the internship should be ended early, this can be done by a termination agreement. In this case, both parties agree in writing that the internship contract will be terminated prematurely by mutual agreement.

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Do employers have to issue an internship certificate?

Section 630 BGB and section 109 Trade Code (GewO) state that the employers fundamentallyobliged to issue workers, including Interns a certificate within the meaning of section 26 BBiG . The right to an internship certificate in the case of voluntary internships is also regulated in section 16 BBiG.

The employer is, however, not required to issue an internship certificate on their on initiative. The intern must demand the certificate.

By the way: The duration of the internship is irrelevant for the entitlement to an internship certificate. According to section 109 GewO, the internship certificate must also be issued in writing; electronic form does not suffice.

In the case of a compulsory internship, the responsible educational institutions usually require an internship certificate or proof of internship from the employer. In principle, this is not an accurate assessment of the intern's work performance. Rather, the employer only confirms that the internship was completed within the company within a certain period of time and which areas of activity it covered. However, the intern can ask the employer to issue him an internship certificate which not only certifies what he has done but also assesses his work performance and ability as a whole.

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4 tips for employers and HR about an internship contract 

• During an internship, the focus must always be on acquiring practical knowledge and experience of a specific operational activity in preparation for a professional activity in order to be considered as such (section 22 (1) p. 3 MiLoG). The risk of so-called “bogus internships” should always be kept in mind!
• Before hiring an intern, the employer should always check whether the internship must be completed as part of school or university education. In doing so, he should also ensure that the practical activity meets the requirements of the study or training regulations. For correct classification (and also for documentation purposes), the employer should therefore obtain the respective study or training regulations as proof.
• Depending on whether it is a compulsory internship or a voluntary internship, there are different rights and obligations for the employer and the intern, which should be included in the internship contract.
• According to section 22 (1) MiLoG, interns are entitled to the statutory minimum wage. Before starting the internship, the employer must therefore check whether the Minimum Wage Act applies to the internship relationship.