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TORONTO – Young Canadians eager to launch their careers say they’re under mounting pressure to take unpaid internships that promise valuable experience and a foot in the door but rarely lead to permanent work.

Unpaid internships are replacing entry-level jobs, experts say, propelled in part by a recession that has forced companies to tighten their belts and graduates to fight for any advantage in the job market.

But some of these positions are illegal, says Andrew Langille, an employment lawyer in Toronto who has researched labour standards and case law related to internships.

“I would say upwards of 95 per cent of unpaid internships (in Ontario) are probably illegal,” because interns are doing work typically performed by paid employees, he says.

“If you have an intern making coffee or researching articles . . . then they’re an employee, not an intern, and they should be getting minimum wage and all the other protection that comes with the Employment Standards Act.”

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Companies offering unpaid internships say they’re part of a sweeping shift in workplace culture, one that rewards “hungry” workers willing to go above and beyond their job descriptions.

But many young grads, while willing to pay their dues at the office, say they can’t afford to work for free, particularly while saddled with student loans.

“There’s people who say young people expect everything right now, they want this great-paying job,” says Heather Bellingham, a 26-year-old from Oshawa, Ont., who has held a string of unpaid internships since graduating from a film and television college program. “I don’t expect a lot – I would love minimum wage.”

Setting and enforcing employment standards such as minimum wage falls to the provinces, except for federally regulated industries such a aviation and telecommunications.

Yet none of the provinces seem to have rules that directly govern internships. Instead, they have a patchwork of regulations mostly meant for trainees and volunteers that lay out when employers aren’t required to pay minimum wage.

Under Ontario law, “trainees” can work for free under specific circumstances. The training must be similar to what’s given in a vocational school. It must be for the benefit of the trainee, with little to no benefit for the employer. The trainee can’t displace paid employees and isn’t guaranteed a job. He or she must be warned that the position is unpaid.

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Students completing internships for university or college credit can also work for free in Ontario and several other provinces.

Many employers mischaracterize employees as trainees, often because they don’t know or understand the regulations, Langille says.

In the U.S., the federal Labor Department last year pledged to crack down on companies that fail to pay interns proper wages. But the issue hasn’t drawn much attention in Canada, where the internship phenomenon is more recent.

Matt Blajer, a spokesman for Ontario’s Ministry of Labour, says the government will consider suggestions “regarding non-traditional work patterns” when the law is up for review.

He wouldn’t comment on the suggestion that most unpaid internships in the province are illegal.

It’s hard to measure how many people have signed up for internships, paid or not. Statistics Canada, which compiles employment data, doesn’t track internships, nor do federal or provincial labour departments.

A handful of cases have come before labour boards as unpaid wages claims, but “there isn’t a lot of precedent given the new development of internships,” Langille says.

Still, students and graduates say there’s no doubt unpaid work is increasingly common.

Bellingham has worked on film sets, put together sales packages for distribution companies and set up databases – all for free.

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She says she was ready to sacrifice a year or two of wages to gain experience in the field, and some positions have helped her develop new skills.

But now, even with several years of hands-on training, “when I apply (for a job), I’m told to intern,” she says. Employers often hint that an internship could turn into a permanent job, but so far, none have, she adds.

As a result, Bellingham lives with her mother, unable to buy food, much less rent a place of her own, she says. “I can’t move forward with my life because I don’t have an income.”

Kelly Fallis, CEO of the web-based design firm Remote Stylist, says she’s had unpaid interns work on projects in marketing, communications, business development and design.

The company won’t hire anyone full-time if they haven’t completed a 12-week placement first to see if they fit in, she says, adding unpaid internship are part of “a new business model” that pushes young workers to show passion for their job.

“There’s something about the hungriness of it all” that isn’t there in a minimum-wage, entry-level position, she says.

Fallis says she doesn’t see anything wrong with the arrangement.

“At the end of the day, these people are doing something to get ahead in the world . . . so why put restrictions on them? If they want to work for free, it’s their prerogative.”

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“It’s such a win-win for everyone . . . there’s no down side to me.”

Langille says labour laws need to keep up with the changing realities of the workplace, including the rise in unpaid internships.

Provinces need to apply the rules aggressively, he says, noting few interns will risk filing a complaint against their employer.

“What’s occurring now is very exploitative,” he says.