Interns – When is it OK to Work for Free?

In 2011, two unpaid interns who worked on Fox Searchlight’s movie, Black Swan, sued the studio alleging that it violated the law by failing to pay them minimum wage and overtime.  Their jobs included making coffee, completing purchase orders and obtaining signatures on documents.  In early 2012, an former intern at Harper’s Bazaar filed a similar lawsuit.  She alleged that her unpaid internship violated labor laws because it wasn’t an “internship.”  Rather, it was simply unpaid labor.

The rules on what makes a unpaid position a valid internship, and thus excuses the employer from paying minimum wage and overtime, are very specific.  And, recent news coverage suggests that virtually all unpaid internships are illegal.  That is because   Federal Law requires the application of six criteria, none of which are typically satisfied:

 1.         The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;

2.         The internship experience is for the benefit of the intern;

3.         The intern does not displace regular employees, but works under close supervision of existing staff;

4.         The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded;

5.         The intern is not necessarily entitled to a job at the conclusion of the internship; and

6.         The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

BOLI also explains that there must be an internship program that includes the following:

  • A planned program of job training and work experience for the student, appropriate to the student’s abilities, which includes training related to pre-employment and employment skills to be mastered at progressively higher levels that are coordinated with learning in the school-based learning component and lead to the awarding of a skill certificate.
  • The learning experience encompasses a sequence of activities that build upon one another, increasing in complexity and promoting mastery of basic skills.
  • The learning experience has been structured to expose the student to all aspects of an industry and promotes the development of broad, transferable skills.
  • The learning experience provides for real or simulated tasks or assignments that push students to develop higher-order critical thinking and problem-solving skills.

So, before you call someone an intern, and let them appear at your office 8 hours a day, make sure you have a program in place and that they are an intern, not an employee.

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