By: Lauren G. Goetzl
Wage and hour laws create a potential minefield for for-profit businesses attempting to offer internship opportunities for students.
According to the U.S. Department of Labor, employers can lawfully offer unpaid internships where the interns’ work serves only their own interest and the company provides aid and instruction to such end. If, on the other hand, the intern performs work for the benefit of the employer, including work that regular employees would otherwise perform, the individual will be considered an “employee” and will be entitled to at least the minimum wage under governing wage and hour laws.
Employers seeking to establish unpaid internship programs should follow the following guidelines:
- Employers should create programs with the education of the intern in mind, rather than the goals of the company. For example, employers should structure their internship programs to parallel closely a classroom or academic experience, perhaps by developing written curriculum that sets forth educational tasks that interns must achieve during the internship. In doing so, the employer should focus on imparting skills that the intern can use in multiple employment settings, rather than just the employer’s operation.
- Employers should be sure that, by establishing an internship program, they do not use unpaid interns to supplement their existing workforce. Instead, the intention should be to provide opportunities to the individuals, such as job shadowing or working closely under an employee’s supervision.
- Employers should avoid asking interns to complete unskilled jobs, such as getting coffee or making copies.
- Internships should be of a fixed duration, established prior to the outset of the internship, and should accommodate the individual’s academic calendar.
- The employer should not use the internship as a “trial period” for individuals seeking employment at the conclusion of the internship period. The Department of Labor has opined that “[i]f an intern is placed with the employer for a trial period with the expectation that he or she will then be hired on a permanent basis, that individual generally would be considered an employee under the FLSA.”
- Employers should be clear that there is no expectation of compensation, as any such promise, express or implied, will indicate that the intern is an employee. Employers would be advised to sign a written agreement with interns indicating that they understand both that they are not entitled to a job upon completion of the program and that they are not entitled to payment for their services.
- Human Resources should monitor the internship program and check in periodically with the interns and their supervisors throughout the program to ensure that all parties are conforming to these rules. Employers are advised to provide interns with a contact or hotline telephone number for making work-related complaints.
Employers will likely continue to see issues surrounding the permissibility of unpaid internship programs. In addition, state and local governments have been enacting legislation aimed at restricting unpaid internships. Employers are highly encouraged to seek counsel from employment attorneys well-versed in employment law to ensure compliance with current legal authority.