Changes from report parliamentary committee draft to plenary report

BACKGROUND

The number of traineeships offered in the Union is growing rapidly. It is estimated that the majority of 18 to 35-year-olds -up to 78%- currently complete a traineeship, with this figure expected to rise by at least 16% by 2030.

Despite their prevalence, traineeships remain a broad, loosely defined concept. The umbrella term encompasses everything from graduate traineeships advertised in the open labour market (often called ‘internships’) to mandatory training for professions (e.g., doctors or lawyers), traineeships earning university credits, and those part of active labour market policies. These are just examples, not legal categories, and often overlap.

What unites these traineeships is that they aim to provide a short period of entry-level work to help young people gain practical and professional skills to facilitate the transition from education to stable employment, or accessing a profession. To gain these skills in a workplace, it is both expected and inevitable that the trainee will perform work during their traineeship.

Traineeships can be of significant benefit to both the trainee and the traineeship provider. They can constitute an important pathway for young people’s access to the labour market and to certain professions, as well as complementing their academic skills. For traineeship providers, they can provide an opportunity to attract, train and retain young people while reducing recruitment costs. However, these benefits will only materialise if traineeships are adequately regulated.

Without adequate regulation, traineeships can pose risks. The lack of clarity regarding the concept and rights of a trainee has led to cases where young people perform work without protection against potential harm and exploitation.

The concerns are twofold: firstly, traineeships result in discriminatory practices. Unpaid or poorly paid traineeships can exclude young people from vulnerable backgrounds. The European Ombudsman, in 2017, labelled unpaid traineeships as a ‘vicious circle where privilege follows privilege’. Moreover, a lack of pay and reduced rights for young people can lead to age, race, disability, and gender discrimination. For instance, unpaid trainees are often women, with evidence of high rates of sexual harassment, and trainees with disabilities may receive fewer accommodations than workers with disabilities. Discrimination can also arise based on worker status: if a trainee performs the same work as an employee without pay at the same establishment, it is unequal treatment, as is the case when one trainee is unpaid because they are completing a curricular traineeship.

The second concern is the abusive practices arising from traineeships. Rather than facilitating the transition from education to stable employment, or accessing a profession, traineeships can be used to replace entry-level jobs as a form of cheap, unregulated labour without any guarantee of a training opportunity. This can be particularly true of traineeships completed as part of an academic or vocational curricula: the assumption that such traineeships are of better quality has been empirically questioned, especially with the rise of ‘internship intermediaries’ -unregulated agencies used by universities to source internships-.

The current lack of clarity over the rights of a trainee also generates an unequal playfield across Member States and between establishments, with some providers benefiting from unpaid work at the expense of those who pay their trainees.

APPROACH OF THE DRAFT REPORT

The two concerns laid out above -discriminatory implications and abusive practices arising from traineeships- stem directly from the lack of regulatory clarity. The absence, complexity or diversity of regulatory frameworks across Member States, along with weak enforcement, allows these abusive practices to arise.

This is despite the Court of Justice's case-law (the ‘CJEU’), which has consistently held that the concept of "worker" under Article 45 TFEU extends to a person serving a traineeship. According to the CJEU’s case-law, the criteria for an employment relationship are that a person performs services for and under the direction of another for a certain period, receiving remuneration. This includes anyone pursuing real and genuine activities, excluding those deemed purely marginal and ancillary.

Trainees have, under the CJEU’s case-law, consistently met this definition of a worker. That is because there is a fundamental overlap between the concept of a worker and the concept of a trainee (as defined under the 2014 Quality Framework Recommendation). Trainees are under the direction of the traineeship provider and perform ‘real and genuine’ work. The lack of remuneration itself does not prevent unpaid trainees from being classed as workers (otherwise, it would be a circular requirement: all employers could claim their workers are not workers because they are unpaid). Remuneration has also not been an issue in other CJEU decisions on worker status. ‘Real and genuine’ work refers to anything beyond purely marginal or ancillary activities, and the CJEU has held this includes ‘work done to acquire or improve skills or complete vocational training’ within a traineeship.

What is most significant is that to carry out ‘solid and meaningful’ learning content rather than ‘menial tasks’ (as required under the 2014 Recommendation), trainees are likely to perform ‘real and genuine’ work. To learn, trainees need to engage in real and genuine work, meaning they will be classified as workers.

This is true of all types of trainees. The CJEU has applied the employment nexus to all four types: open market traineeships, those mandatory for a profession, linked to active labour market policies, and part of an academic or vocational qualification. The CJEU has also treated apprenticeships, recognised as vocational qualifications, as having worker status.

One of the main concern around introducing regulation on traineeships is that it will detract from the fact that trainees are most likely considered workers under the CJEU’s criteria. The further concern is that, unless a trainee is defined with clear rights and entitlements, then it is not possible to identify ‘fake’ trainees without knowing what a ‘genuine’ trainee is. It is also problematic to depart from the apprenticeship model: this approach is a trade-off, dating back to the medieval period, in which young people receive a reduced wage in return for a recognised qualification. Traineeships, however, receive neither.

It is therefore more consistent with the CJEU’s case-law to regard trainees as a type, or subset, of worker. Analogy can be made with part-time, fixed-term, or agency workers under existing EU provisions.

In light of this, Article 153(1)(b) TFEU is the relevant treaty basis for the Directive as it addresses the working conditions of trainees. Under Articles 165(4) and 166(4) TFEU, the Union does not have the competency to adopt a Directive on education or vocational training, respectively. Traineeships which are offered as part of an academic or vocational qualification straddle both competencies as they are designed to provide a period of work during a learning programme.

Where competencies overlap, the CJEU has relied upon the ‘centre of gravity test’ to determine the appropriate treaty basis, based on an examination of the main purpose of the measure. This Directive primarily regulates the working conditions of traineeships, not education or vocational training. Given that there is no qualification attached to a traineeship, nor formal curricula involved within a traineeship, they do not fall under vocational and education training regimes. Moreover, traineeships undertaken during a university degree are marketed as an experience outside of academia. The aim is to complement academic studies with actual experience of work. The centre of gravity is therefore on the work undertaken during the traineeship, not the educational provider.

The draft report is therefore designed to address the two major concerns - discrimination and abusive practices arising from the use of traineeships - through a three-point approach.

STRUCTURE OF THE DRAFT REPORT

The Directive has three approaches to addressing the discriminatory and abusive practices arising from the use of traineeships. It aims to adequately regulate the working conditions of the work undertaken by the trainees during the traineeship, as provided for under Article 153(1)(b) TFEU.

Common Definition and Concept

First, the Directive provides a common understanding of the concept and purpose of a traineeship. Within the Union, a traineeship is understood as a limited period of entry-level work aimed at providing practical and professional skills through significant training to facilitate the transition from education to stable employment, or accessing a profession, based on a written contract between the trainee and the traineeship provider, which is paid in accordance with Directive (EU) 2022/2041.

This shared understanding among trainees, traineeship providers, and Member States will prevent abusive practices arising from a lack of clarity.

Principle of Non-Discrimination

Second, the Directive aims to ensure that the Union’s existing anti-discrimination protections under Council Directive 2000/78/EC, Directive 2006/54/EC, and Council Directive 2000/43/EC are applicable to trainees, providing legal clarity and reinforcing trainee’s rights.

Measures to Prevent Abusive Practices

Third, the Directive introduces Article 4 and 5 to prevent abusive practices arising from the use of traineeships for purposes other than facilitating the transition from education to stable employment, or accessing a profession.

To achieve this, the Directive sets criteria for identifying abusive practices for competent authorities to rely on, such as the absence of a training component, the lack of a written contract, the excessive duration, and the lack of a public vacancy notice. Traineeship providers who have a high ratio of trainees relative to the size of the establishment, or who replace permanent posts with traineeship adverts, may also indicate abusive practices.

Using this framework, the Directive therefore enables competent authorities to identify and protect against abusive practices arising from the use of traineeships in the Union.