Almost every startup I know has hired interns at one point or another.
- How much do you need to pay them?
- Do you need to pay them?
- What kind of contract is needed?
I'll cover the basics that I know from a UK perspective. I'm not an employment lawyer, so do your own research and make your own decisions.
The first thing to realise is that there is a choice to make;
Are you hiring someone on a low wage to do meaningful work on a longer term project or...
Are you taking on a volunteer who will be learning on a short placement and who will be mentored and have structured learning feedback?
- If the project is more than 3 months? That's probably (1)
- If the work wouldn't get done otherwise? That's probably (1).
The choice is simple. You are either taking on a minimum wage employee worker (1) or a volunteer on a learning experience (2). Workers have employment rights, volunteers don't.
Employees (1) need a fixed term employment contract and must be paid the minimum wage. (It’s a criminal offence for employers not to pay someone the National Minimum Wage or to falsify payment records.)
Volunteers (2) need a volunteering agreement and are paid expenses for travel and subsistence (e.g. Lunch). If you are going to just offer someone expenses as a volunteer you need to be aware that you will not be protected as you would with an employment agreement when it comes to intellectual property.
Here's a useful example of a volunteering agreement from the Institute of Directors
Employment rights and pay for interns from Gov.uk
What counts as an intern? from Gov.uk
National minimum wage information for employers from Gov.uk
Current national minimum wage rates from HMRC