On December 13, 2025, the Karnataka Labour Department issued an urgent advisory to tech parks and manufacturing clusters after receiving more than 80 complaints from engineering and management students about unpaid or underpaid internships during peak placement season. Several students alleged that companies were calling them “project trainees” to avoid paying stipends despite assigning full-time operational work. The advisory states that internships involving productive work must follow minimum stipend norms and be reported to the department. Inspectors have been directed to begin spot verifications in major Bengaluru offices and to review contractor-managed internship programs.
Across campuses and workplaces, the emotional reaction has been intense and conflicted. Students feel a mix of validation and anger, saying the state finally recognised the exploitation they face under the guise of “industry exposure.” Some HR teams, especially in startups, feel worry that the crackdown may force them to cancel their internship programs altogether, disrupting their hiring pipeline. Employees mentoring interns express guilt for assigning real tasks without compensation, while managers fear reputational backlash on LinkedIn if interns speak out. The collective mood is a blend of frustration, justice-seeking, and quiet panic as companies realise casual internship structures may no longer be defensible.
Legally, the advisory intersects with the Karnataka Shops & Commercial Establishments Act, the Apprentices Act, 1961, and recent interpretations that distinguish genuine academic training from disguised employment. If interns are doing productive work, employers must comply with wage obligations, working hour norms, and safety rules. HR and compliance teams must now reassess internship templates, ensure clear learning outcomes, and document academic tie-ins to avoid being flagged as disguised employers. Companies will also need to revise mentor responsibilities, create structured evaluations, and maintain transparent stipend policies. This shift signals that informal internship arrangements may soon face auditable scrutiny, requiring immediate alignment with statutory and ethical expectations.
What changes should companies make to ensure internships remain fair and legal?
How can HR support managers while setting clear boundaries for intern work?
Acknowledge(0)
Amend(0)
7Across campuses and workplaces, the emotional reaction has been intense and conflicted. Students feel a mix of validation and anger, saying the state finally recognised the exploitation they face under the guise of “industry exposure.” Some HR teams, especially in startups, feel worry that the crackdown may force them to cancel their internship programs altogether, disrupting their hiring pipeline. Employees mentoring interns express guilt for assigning real tasks without compensation, while managers fear reputational backlash on LinkedIn if interns speak out. The collective mood is a blend of frustration, justice-seeking, and quiet panic as companies realise casual internship structures may no longer be defensible.
Legally, the advisory intersects with the Karnataka Shops & Commercial Establishments Act, the Apprentices Act, 1961, and recent interpretations that distinguish genuine academic training from disguised employment. If interns are doing productive work, employers must comply with wage obligations, working hour norms, and safety rules. HR and compliance teams must now reassess internship templates, ensure clear learning outcomes, and document academic tie-ins to avoid being flagged as disguised employers. Companies will also need to revise mentor responsibilities, create structured evaluations, and maintain transparent stipend policies. This shift signals that informal internship arrangements may soon face auditable scrutiny, requiring immediate alignment with statutory and ethical expectations.
What changes should companies make to ensure internships remain fair and legal?
How can HR support managers while setting clear boundaries for intern work?
Acknowledge(0)Amend(0)
To ensure internships remain fair and legal, companies should make several changes.
Firstly, they should clearly define the role of interns. If interns are doing productive work, they should be compensated according to the minimum stipend norms. This is in line with the Karnataka Shops & Commercial Establishments Act and the Apprentices Act, 1961.
Secondly, companies should reassess their internship templates. They should ensure that the templates clearly outline the learning outcomes for the interns. This would help distinguish genuine academic training from disguised employment.
Thirdly, companies should document academic tie-ins. This would provide evidence that the internship is part of the intern's academic program and not a form of disguised employment.
Fourthly, companies should revise the responsibilities of mentors. Mentors should be made aware of their obligations towards interns, including the need to provide meaningful learning experiences and not just assign operational work.
Lastly, companies should maintain transparent stipend policies and create structured evaluations. This would help ensure that interns are compensated fairly for their work and that their performance is evaluated objectively.
HR can support managers by providing guidance on how to set clear boundaries for intern work. This could include developing guidelines on the type of work that can be assigned to interns, the hours they can work, and the compensation they should receive. HR can also help managers understand their responsibilities towards interns, including the need to provide meaningful learning experiences and not just assign operational work.
In addition, HR can play a crucial role in ensuring that the company's internship program complies with all relevant labour laws. This could include conducting regular audits of the program, providing training to managers and mentors, and liaising with the labour department as necessary.
It's important for companies to remember that while internships can be a valuable source of talent, they also have a responsibility to provide a fair and meaningful learning experience for interns. By making these changes, companies can ensure that their internship programs are both legally compliant and beneficial for all parties involved.
From India, Gurugram
Acknowledge(0)Amend(0)
Firstly, they should clearly define the role of interns. If interns are doing productive work, they should be compensated according to the minimum stipend norms. This is in line with the Karnataka Shops & Commercial Establishments Act and the Apprentices Act, 1961.
Secondly, companies should reassess their internship templates. They should ensure that the templates clearly outline the learning outcomes for the interns. This would help distinguish genuine academic training from disguised employment.
Thirdly, companies should document academic tie-ins. This would provide evidence that the internship is part of the intern's academic program and not a form of disguised employment.
Fourthly, companies should revise the responsibilities of mentors. Mentors should be made aware of their obligations towards interns, including the need to provide meaningful learning experiences and not just assign operational work.
Lastly, companies should maintain transparent stipend policies and create structured evaluations. This would help ensure that interns are compensated fairly for their work and that their performance is evaluated objectively.
HR can support managers by providing guidance on how to set clear boundaries for intern work. This could include developing guidelines on the type of work that can be assigned to interns, the hours they can work, and the compensation they should receive. HR can also help managers understand their responsibilities towards interns, including the need to provide meaningful learning experiences and not just assign operational work.
In addition, HR can play a crucial role in ensuring that the company's internship program complies with all relevant labour laws. This could include conducting regular audits of the program, providing training to managers and mentors, and liaising with the labour department as necessary.
It's important for companies to remember that while internships can be a valuable source of talent, they also have a responsibility to provide a fair and meaningful learning experience for interns. By making these changes, companies can ensure that their internship programs are both legally compliant and beneficial for all parties involved.
From India, Gurugram
Acknowledge(0)Amend(0)CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.
Labour laws.ppt
All the labour laws.doc
Labour Laws.pdf