Interns engaged under the PM Internship Scheme are not Employees: Ministry of Labour
Under PM Internship Scheme, 500 top-ranked corporations have agreed to offer year-long internships to 10 million Indian students over a five-year period. Some of the organizations that have offered internships thus far include Mahindra & Mahindra, Bajaj Finance, Jubilant Foodworks, Muthoot Finance, Eicher Motor, Larsen & Toubro, and Tech Mahindra.
The Ministry of Labour and Employment (“MoLE”) Social Security Division, in an office memorandum NO. S-65025/01/2024-SS-II dated 27.9.24, determined that interns participating in the PM Internship Scheme will be employees under Labour Law.
The Ministry analyzed the definitions of wages and employees as indicated in Sections 2(b) and 2(f) of the Employees’ Provident Funds and Miscellaneous Provisions Act of 1952, as well as provisions from the Payment of Wages Act of 1936. The review stressed that pay are subject to the terms of employment, whether explicitly expressed or assumed.
This determination is critical in determining whether the funds provided constitute wages. Furthermore, the MoLE cited a circular from the Ministry of Corporate Affairs dated September 18, 2024, which stated that internships are not considered paid work. The circular further said that the monthly internship allowance of INR 4,500 (Indian Rupees Four Thousand Five Hundred) will be put directly into the intern’s account by the Government of India. Following this research, the MoLE concluded that interns participating in the PM Internship Scheme do not qualify as workers.
The first phase of the Prime Minister’s Internship Scheme received over 1,55,000 registrations from interested candidates. This is an incredible response that well beyond expectations. The Indian government had hoped to pick one lakh individuals for internships by the end of 2024. Over 80,000 internships are already available from approximately 200 firms in a variety of industries, including banking, manufacturing, energy, automobiles, defense, aviation, oil and gas, travel and hospitality, financial services, infrastructure, and construction.
Under this initiative, 500 top-ranked corporations have agreed to offer year-long internships to 10 million Indian students over a five-year period. Some of the organizations that have offered internships thus far include Mahindra & Mahindra, Bajaj Finance, Jubilant Foodworks, Muthoot Finance, Eicher Motor, Larsen & Toubro, and Tech Mahindra.
The Ministry of Corporate Affairs, which is in charge of the scheme’s execution, lists these 500 partner firms on its website.
Under the plan, young interns aged 21 to 24 would have the opportunity to master skills and earn work experience. They would also be paid Rs 4500 per month (Rs 4000 from the government and Rs 500 from the enterprise), plus Rs 6,000 as a one-time support payment. That is not all; they are also entitled for insurance coverage under the Pradhan Mantri. Jeevan The Jyoti Bima Yojana and Pradhan Mantri Suraksha Bima Yojana
Stay tuned, to PeopleManager.co.in for further updates on the evolving workplace paradigm.
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