As you may be aware we are trying to enable as many students as possible to undertake a placement here at the University. As well as paid placements which are arranged via HR, we also need to be in a position to offer incentives for students to undertake ‘unpaid’ placements.
I would like to clarify how to do this, while complying with our legal/financial requirements. If a placement is really unpaid (ie the student is given no payment of any kind) there are no issues.
If you wish to give the student some financial incentive, such as a bursary you should only do this in the following ways:
Pay reasonable expenses such as travel (via expenses form with receipts or a travel card) and/or lunch allowance (again via expenses form and receipts)
By a bursary which should not be made as a one off payment but rather as a weekly payment on Form 7. In order that the student does not pay national insurance this payment should not be more than £110 per week. Students should be told that they need to complete a P46 (available from Payroll) or else they will be taxed on this amount. If they work anywhere else but earn less than £6475 in any one tax year they can claim a tax refund from the Inland Revenue (refer them to Payroll for further advice).
Please ensure that in future unpaid placement students are only engaged on this basis.
Professor Helen Higson