Nicholas Smith is a 22-year-old Torontonian, working on his second unpaid internship after graduating from the University of Toronto last year with an ethics degree.

Working without pay for months — and sometimes years — after graduating triumphantly wasn't exactly what Smith and his friends had in mind when they toiled away along the path to what they believed was a bright future.

"I am working with people who've done their masters degrees, and definitely there's an emotional toll in having to work for free," said Smith, whose current unpaid internship is at a Toronto-based think-tank as a foreign policy analyst.

"I used to do marketing and there are a couple of marketing companies that are absolutely notorious — they have marketing graduates working 50-hour weeks and overtime without pay, and if you refuse to work the OT you don't get a reference," he said.

"And no one is picked up anyway at the end of the internships. It's just exploitation."

'19th-century labour practices'

Unpaid internships are on the rise in Canada, with some organizations estimating there's as many as 300,000 people currently working for free at some of the country's biggest, and wealthiest, corporations.

The ranks of unpaid interns swelled in the aftermath of the 2008 economic recession, said Sean Geobey, a research associate with the Canadian Centre for Policy Alternatives and the author of a recent report entitled The Young and the Jobless.

The University of Victoria's Isabelle Couture and James Attfield are researching unpaid internships and have found interns are reluctant to complain about their working conditions because they fear being 'blacklisted.' (The Canadian Press)

Geobey says Canadians are starting to sit up and take notice.

"This is not the sort of social contract that today's kids saw their parents and grandparents grow up under," he said.

"We're starting to see Canadians — young people and their parents in particular — seriously question what exactly is going on here, and why are we apparently returning to 19th-century labour practices."

"As a busperson you will take pride in the integral role you play in supporting your food and beverage colleagues and 'setting the stage' for a truly memorable meal." The ad was quickly taken down amid a social-media furor.Last fall, Vancouver's Fairmont Waterfront Hotel sparked an uproar after it posted an ad seeking people to bus tables for free.

'There's a hodgepodge of laws across the country and in some provinces there's simply no regulation at all. - NDP MP Andrew Cash

The United States is in the midst of a crackdown on unpaid internships by both state and federal authorities. In Canada, there's a growing backlash, with a rally held last week in Toronto urging the Ontario government to do something about "unpaid internship scams."

Federally, the NDP's Andrew Cash tabled a private member's bill last fall aimed at cracking down on what he calls "the Wild West" of illegal unpaid internships. He says what used to be entry-level positions paying minimum wage are now routinely morphing into unpaid internships.

"There's a hodgepodge of laws across the country and in some provinces there's simply no regulation at all," Cash said in a recent interview.

And not only are we talking about young university graduates having to work for free, but also newcomers to the country who are desperate for Canadian work experience and are resorting to working without pay."

An official at the federal Labour Department says there are laws on the books to protect interns. Under the Canada Labour Code, a department inspector will investigate a federally regulated employer if a complaint is filed for unpaid wages, overtime and vacation pay.

"If it's determined an employer-employee relationship exists between interns and the employer, their rights will be protected as an employee," the official said in a recent email.

Nonetheless two academics working on a comprehensive study of unpaid internships in Canada scoff at those laws, pointing out that they require a young employee who's trying desperately to establish a career to rat out a possibly powerful corporation — and potential employer.

Bell promotes its Professional Management Program with images such as this, showing interns gaining from the experience. (Bell PMP)

"There aren't enough people coming forward, because there's a huge disincentive to do that," said Isabelle Couture, a graduate student who's conducting a survey of unpaid interns with the Canadian Intern Association to determine the scope of the problem in Canada.

"To go against your employer, you're fearing being blacklisted. You want the experience and you want the reference and feel you have no other choice but to keep quiet."

No tracking

Couture and her partner in the research, James Attfield, say that as they prepare to release their study next month, they've been stunned to learn that no federal or provincial agency is tracking unpaid internships.

"When you ask a lot of these companies, like Bell — which has a massive internship program — they make it sound like they're doing people a favour, that they're generously providing work and experience," says Attfield.

It's really nothing more than a way to save money; they're obviously not doing it out of generosity. - James Attfield, labour researcher

"But it's really nothing more than a way to save money; they're obviously not doing it out of generosity."

A Bell spokeswoman says its internship program, which employs about 300 people a year, "offers learning opportunities in a real-world corporate setting. None of the participants' activities replace work by Bell employees or support our business operations."

But Attfield and Couture, who are both working toward master's degrees in public administration, point out that unpaid internships pose an array of social and economic problems.

They give the children of well-heeled parents an advantage over those with no one to support them if they want to compete with their peers for valuable CV references by working for free, they say.

They also contribute to youth unemployment rates, and prevent young Canadians from fully participating in Canada's economy.

Everyone suffers but the company

"It's so short-sighted, because these companies are withholding pay from people who might be able to pay for their goods and services and to contribute economically to society," said Attfield.

"There's a cost to everyone as a result of these internships — to the employees who don't get paid, to their parents, to the economy — at absolutely no cost to the companies."

I can't say that I've got job prospects, but the networking opportunities have been really helpful. - Intern Nicholas Smith

Geobey says it all represents a startling throwback to another era.

"This is what union organizers faced prior to the First World War. There's the threat of blacklisting, the threat that their skills are not going to be used because the employer will call them troublemakers for wanting to be paid for their work."

Smith, the 22-year-old intern, isn't quite as contemptuous, saying he's grateful for the experience he's currently getting from his unpaid internship.

"I can't say that I've got job prospects, but the networking opportunities have been really helpful."