Volunteering: Smart Strategy or Weak Gambit?

While a small percentage of the population (whether through luck or careful planning) has acquired a set of specialized skills that are in extremely high demand right now, and can more or less write their own ticket, this experience is far from the norm.  Most of us just didn’t have the foresight — or good fortune — to train for a career in nursing, petroleum engineering, or Ruby on Rails programming.

Instead, the majority of professionals are finding the waters out there to be highly competitive and are discovering that their skills and credentials, in and of themselves, aren’t always quite enough to stand out from the crowd.  As a result, the real go-getters among the unemployed are getting creative and trying unconventional, innovative strategies to distinguish themselves and persuade employers to give them a shot at various opportunities they come across.

For example, some folks are going so far as to try and overcome employer objections by offering their services completely for free, as part of a probationary or pre-employment trial period.  Recently, in fact I received the note below from a client of mine:

“Matt:  Good news!  I am going to work for Xeta Systems as their VP of Sales & Marketing.  Xeta is an aerospace technology company that develops and distributes advanced avionics components for Boeing and other aircraft manufacturers.  The most interesting part of my story is the tactic I used to overcome the objection of not having any previous experience in the avionics industry.  After my first interview, I sensed they liked my proven sales background, but couldn’t get past my lack of direct industry experience.  I called them and told them I had an idea that would provide them the solutions they seek at no risk to them, and that I wanted to meet face-to-face to speak about it.  At the end of the day, I told them I would pay for my learning curve by interning for 45 days, and then, at the end of the period, they could let me go if they were not satisfied with my accomplishments and what I was able to produce!”

I changed a few details above, of course, to keep this story anonymous — but it’s a true story, nonetheless.  But here’s the rub.  Another client recently came along who apparently had the exact same thought, but first asked me whether such an arrangement was even legal, given IRS regulations and various laws against indentured servitude.  Like my other client, she wanted to nudge a company past their reservations and convince them to give her a chance, by foregoing a paycheck, but said she’d heard many conflicting opinions in terms of the legality of such an arrangement.  Some people she’d asked told her that no, companies aren’t allowed to have individuals on staff who work for free (outside of carefully-constructed internship parameters)  whereas other people have said sure, donating your services for a while is fair game, as long as you do so voluntarily.

I honestly don’t know the exact answer to this question.  I suppose I could make a few inquiries and track one down, but instead, I thought it might be more interesting to throw the question out to all of you — and solicit your opinion both in terms of the “legality” of working for free, as well as your thoughts about the value and appropriateness of this kind of unorthodox negotiating tactic, in general.

Any opinions to share out there, on either matter?

P.S.  And in the event such an arrangement truly ISN’T legal, aren’t there some fairly famous (albeit rare) stories where corporate executives and public officials have offered to work for a single dollar, until their company’s revenues recover?  Are these just old wives tales or are they a clear violation of minimum wage law?

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9 Responses to “Volunteering: Smart Strategy or Weak Gambit?”

  1. Funny, as soon as I got my law license, firms were quick to off me “free” work to get “experience” as they said they couldn’t hire…you’d think they would be more careful about crossing those lines…I didn’t accept any of these offers because I couldn’t afford to, but I did volunteer at a few actual legal organizations that provide services to lower income clients to try out a few practice areas.

  2. Hi Matt,
    I currently work for a non-profit org. One of my deliverables is to identify internship opportunities for non-exempt individuals. There are a number of reasons that employers do not want to participate in a business model that offers free labor. The primary reasons include who will incur the L&I costs, as well as the perception of the displacement of currently employed individuals.

    On the surface this proposal appears to be a win-win, but underneath are many hidden issues and “gotchas.”

  3. Offering to work for free for a limited time is an idea I’ve considered as well. After a few situations where some well known large companies clearly used the “interview process” as a method of getting free work out of me, I wondered if I should just offer to work for free and try to build in some protections. I’ve heard of situations where this has worked but have not tried it yet. As to the legality of it, I suspect it is in fact legal as long as the company has the individual properly classified as an unpaid intern or extern. Some of these situations are legal, others are not. As for executives working for a dollar, I suspect that is mostly hype. I’ll bet they have some very significant deferred compensation, stock grants and options, bonus structures and the like. New disclosure rules try to make it harder to avoid making full disclosure of total compensation. I have tried offering to pay my own relocation costs, but have found that companies tend to assume that only means that I am either not totally committed or will continue to look for something else. Often companies that pay relocation costs do so only with an agreement that you reimburse them if you don’t stay at least some predetermined length of time. There may be some room for some creative arrangements but I haven’t found a good way to start that discussion as a way of getting the hring process started without sounding desparate or insecure about the value of my work.

  4. Dear Matt,

    I tried suggesting a 60 day trial period to close a job interview in July but the suggestion just back fired on me.

    We have friends that are concerned for our well being. They are very well off and have strong
    Christian believes. The gentleman made me an offer of supporting me for 60 days on hearing I was interviewing for a position in Utah. This allowed me to offer working for 60 days with NO cost to the firm.

    I got an interview with the President of the company and then was passed to the VP of Sales. On close, the VP asked me to give it my best shot. I offered to work for 60 days as a trial period without commitment to show I could turn the results they wanted. The position was in a small town south of Prevost. The discussions turned to my living cost while there. I indicated I would address them. I did not sound desperate but I have since checked with others.

    Many of my friends indicated they would see this as an act of desperation. I did ask you about the situation at the time and the response was not to do it.

    I think this approach is useable but it takes a special arrangement for it to work. In most cases, this will just throw cold water on the situation.

    Regards,

    Cold Water

  5. I agree with you on being torn about the implications of such a law, for the reasons you mentioned. I feel like it’s like so much of employment law: it’s there to protect against abuses, but in the process it negatively affects other people too.

  6. Jeff: Thanks for your comment and I totally agree with you on the “I don’t value myself” perception you can easily create when offering your services for free. Just for the sake of argument, however, let’s assume my client in this case had exhausted all other possibilities and this was the only way he could convince the company to bring him on board, and to give himself a fresh start in a vibrant new industry, after weathering over a year of unemployment. Would you still recommend against this kind of agreement, on principle alone? Or do you think the “end justifies the means” in a case like this? In a perfect world I’d tell people to walk away from an employer who won’t agree to compensate them fairly right from the start, but in this case, I was kind of thinking, “Hey, whatever it takes…”

  7. Alison: Thanks for the quick response and that was my suspicion on the matter — although I’m torn, morally, on the implications of such a law, because at least in this one case it seems to have led to a win/win result where a person got hired who might not have otherwise. Then again, if all companies were to behave this way, I suppose the concept could be terribly abused. And I routinely see this technique advocated by other career counselors out there to try and help “questionable” candidates bypass employer anxieties. Glad to have a black-and-white ruling on the matter, however — much thanks!

  8. It’s illegal, assuming this is a for-profit company (volunteering IS legal at nonprofits) — but it’s a law that’s rarely enforced. (Just like many unpaid internships are illegal, but they’re still very common.)

    However, a company would be foolish to agree to an arrangement like this, because they’d be opening themselves up to having to pay back pay and damages if it did catch the attention of authorities. Here’s more info on the law:

    http://management.fortune.cnn.com/2011/03/25/unpaid-jobs-the-new-normal/

    http://www.dol.gov/whd/regs/compliance/whdfs13.pdf

  9. Hi Matt, my days of managing boatloads of people are way behind me but my memory is ok. There are two classes of employees, exempt and non-exempt. Typically salaried executives are exempt, meaning they are not subject to wage guidelines such as minimum salary. Check my memory with an HR person. I think I am on solid ground. Consider the CEO that takes a job for 1 dollar.

    Personally, I would not offer my services for free. Consider a reduced rate with performance bonus, accrued compensation paid later, stock for pay, 1099 contract as alternates. Free reflects value in my humble opinion.

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