Unpaid Interns and the Fair Labor Standards Act
Many high school and college aged students have been willing to work as an intern, often times without pay, in exchange for adding the work experience to their resume. They also use the opportunity to gain useful experience to enhance their skills that can be transferred to their ideal job.
Many employers, eager to jump at the chance to receive free labor, usually are insensitive to the labor laws. Most feel that it is fair gain since many of the interns to possess the level of talent and skills that would warrant a salary. Some however do offer stipends to interns for their labor.
Unpaid Interns According to the Fair Labor Standards Act (FLSA)…
There are various regulations surrounding this issue that employers should be aware of. For example, according to FLSA, interns are considered employees that should receive minimum wage and overtime at best, based on their laws and failure to do so, results in violation of the Fair Labor Standards Act.
One of the largest areas concerning this issue is that most employers do not consider interns employees, with this being the case from the employers point of view, then the employer is not in violation of any such law as they simply do not apply.
Based on a fact-specific six-part test that the Department of Labor uses to decipher whether or not an intern is an employee, employers should adhere to such facts to determine if interns are exempt from FLSA’s requirements. They include the following:
1. The internship is similar to training that would be received an educational environment.
2. The experience of the internship benefits the intern.
3. The intern works under the close supervision of the current staff and does not replace any of the current staff members.
4. The employer does not receive an immediate advantage from the intern’s activities.
5. No job is promised to the intern automatically upon the conclusion of the internship program.
6. Both the intern and the employer have an understanding whereby the intern is not entitled to a salary in exchange for their internship.
According to the FLSA, many internship programs do not meet of the criteria described above, which is why many interns are in fact considered employees. Hence the DOL’s strict enforcement of such laws.
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The DOL does offer some very sound suggestions and advice…
Any employers wishing to structure an internship program in their work place should follow the DOL’s guidelines. This allows interns who are not considered employees to be exempt to the minimum wage and overtime requirements set by the FLSA.
These suggestions are very consistent with the requirements of the six-factor employee test. For example, the DOL recommends that employers structure their intern program to reflect an academic setting and experience for the intern, as opposed to the actual operations and functions that take place at the company.
Bringing education and work together…
DOL believes that this method can be accomplished by working with colleges and universities that govern and oversee such programs as well as provide some form of course credit that can be made available to the interns. The intern programs should give the interns an opportunity to develop experience and transferable skills that can be used at other places of employment in addition to be added to their overall job qualifications. This provides more of an even exchange for the time served during their internship.
Additionally, the role of an intern should never be to replace current full time employees. As a matter of fact, the interns that are not paid should not perform regular job duties, but rather very little or no real form of productive work. This includes functions such as clerical work, filing, assisting customers and so forth all of which are viewed as a form of productive work that would establish a relationship with the employer according to the DOL.
Labor Law Compliance is the bottom line.
It goes without saying that employers should be more mindful of the government laws that surround working with interns so that they can stay in compliance with such laws. Additionally, employers that work closely with colleges and universities are likely to be more informed of certain guidelines that have been set forth by the DOL.