Employment Labor Law and Summer InternsJuly 21, 2011
Every summer, a rush of high school and college students look for a leg up on the competition by seeking internships. Summer interns are often viewed as the win/win of the workforce, giving much-needed experience to interns and by providing cheap labor to businesses. Note—we didn’t say “free” labor, which is a common legal misconception! If your business is recruiting unpaid interns, you may be violating employment labor law!
According to the U.S. Department of Labor and the Fair Labor Standards Act (FLSA), there’s a good chance that private-sector summer interns qualify as employees. That means they’re entitled to at least minimum-wage compensation and overtime, just like any other employee. Only under very specific circumstances can private-sector interns go without pay:
- The internship is on par with training an intern would receive in an educational environment;
- The internship is for the benefit of the intern;
- The intern does not supplant needed employees, and works under close supervision of existing staff;
- The employer doesn’t immediately benefit from the intern’s activities, and operations may even be impeded;
- The intern is not guaranteed a permanent position at the end of the internship; and
- Both parties understand that the internship is unpaid.
All of those factors must be met to prove the absence of an employment relationship and to legally justify an unpaid internship. Many employers go wrong by using interns to supplant or bolster their workforce—that is, if not for the interns, there would be no employees to do the work. (For example, a firm consistently hires unpaid interns to answer phones; without the interns, the firm would have to hire a receptionist.) Job shadowing, in which the intern observes a regular employee but performs minimal work, is typically allowable as training instead of employment.
If your business has any question about whether summer interns should be paid, you can consult an employment labor law attorney or you can pay the interns at least minimum wage and any applicable overtime pay. That way, you’ll avoid potential legal problems with the FLSA and you’ll give a small reward to some hard-working students!
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