Internship Agreement

What is an Internship Agreement?

The Internship Agreement is a contract used when hiring an intern by an organization. An internship program is a temporary employment program, typically for students or recent graduates. It is conducted to provide practical experience in a particular field or industry.

It can be used for diverse types of entities like companies, LLPs, partnerships, etc. in any kind of industry including Information Technology, manufacturing, marketing, hospitality, etc.

This Agreement can be used for interns currently studying in some institute or has completed their studies recently and intend to do an internship.

What are the different types of Internships?

Internships can vary based on the nature and duration of internships, including:

• Paid Internship: The intern receives a stipend or salary for their work.
• Unpaid Internship: The intern does not get any payment and is often for academic credits or learning experiences.
• Part-time Internship: The intern will be allowed to work on a part-time basis while continuing with their studies.
• Virtual Internship: The intern works remotely, without visiting the office of the organization.

What is the difference between an Internship Agreement and an Offer Letter for an Internship?

An offer letter for an internship outlines the basic terms of the internship, such as start and end dates, duties, and compensation. An internship agreement is a more detailed, legally binding document that covers specific terms, including work nature, confidentiality, termination clauses, and legal aspects of the internship.

What is the difference between an Internship Agreement and an Employment Agreement?

Employment Agreement is used when hiring an employee on a paid job on a long-term basis. An Internship, on the other hand, is a temporary position that is designed to give a student or recent graduate hands-on experience in a particular field or industry.

In comparison to employment, internships are often unpaid or low-paid, and they may last anywhere from a few weeks to a few months. Internships are often seen as a way for people to gain experience and build their resumes, while employment is a more established and permanent position.

Is it mandatory to have an Internship Agreement?

No, it is not mandatory. However, having a written Internship Agreement helps in avoiding misunderstandings and legal disputes in future.

What does "Intern" mean?

An intern is typically a student or recent graduate who engages in on-the-job training to gain practical experience in their chosen field. Interns often receive minimal or no financial compensation for their work.

What does "Stipend" mean?

A stipend is a regular payment made to the intern by the employee. It is often a a minimal amount to meet the basic needs of the intern including travel and accommodation expenditures. It is not mandatory under the law to pay the intern. However, recent judgments of various courts in India stress paying stipends so that the basic needs of the intern are met.

Who can enter into an Internship Agreement?

Any person above the age of 18 years or a registered entity can offer the internship. An intern must be above the age of 18 years to enter into the Agreement.

If the intern is under 18 years old, consent and a signature from a parent or guardian are required. Individuals under the age of 14 cannot be appointed as interns.

What can be the duration of an Internship Agreement?

The duration can vary based on the organizations needs and the intern's academic schedule. It is often fixed for periods ranging from a few weeks to a few months.

What has to be done once the Internship Agreement is ready?

Once prepared the Internship Agreement should be printed on non-judicial stamp paper or e-stamp paper, and signed by both the employer and the intern. The value of the stamp paper would depend on the state in which it is executed. Each state in India has provisions in respect of the amount of stamp duty payable on such agreements. Information regarding the stamp duty payable can be found on the State government websites.

Once all parties have signed, both the employer and the intern should keep a signed copy of the Internship Agreement. To do this, two different copies can be signed, or if only one copy is signed, it can be photocopied and then distributed between the parties.

Can an Internship Agreement be terminated?

Yes, an Internship Agreement can be terminated. The Internship Agreement is mainly terminated on the following grounds:

• Mutual agreement between both parties
• A material breach of contract by one party such as non-payment, or compromise of key confidential information to third parties.
• Termination without cause by serving the notice period mentioned in the Internship Agreement by either employer or intern.

What must an Internship Agreement contain?

The Internship Agreement must contain the following clauses:

• Detail of parties: Name and details of intern and employer.
• Duration: Start and end dates of internship.
• Stipend: Stipend to be paid to the Intern.
• Schedule and overtime rules: Work with flexible hours or not and the check-in and Check-out rules of the organization.
• Work location: Whether to work remotely or in the office.
• Responsibilities: Obligations of the Intern while working remotely.
• Resources: Resources and facilities provided to interns.
• Performance: Performance reviews and reporting of duties.
• Termination: How the parties can terminate the Internship Agreement.

Which laws are applicable to an Internship Agreement?

The internship may be subject to the applicable labour laws in each state and the general terms of the Indian Contract Act, 1872.

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