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When Can An Internship Go Unpaid?

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As a follow-up to my post, Court Decisions Challenge Legality of Unpaid Internships, here is a bit of information for those interested on what qualifies as an internship and what doesn't.

The Department of Labor (DOL) is the federal body that enforces more than 180 employment laws in the United States, including the Occupational Safety and Health Act (OSH); Fair Labor Standards Act (FLSA); Health Insurance Portability and Accountability Act (HIPAA); Family Medical Leave Act (FMLA); and many more. The DOL website includes a wealth of resources about these and other labor issues.

Specifically, the department offers guidance about "Internship Programs Under the Fair Labor Standards Act," listing six criteria that must be met when determining if an internship or training program can be excluded from the FLSA's minimum wage and overtime rules. These include:

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.

The DOL also notes, "In general, the more an internship program is structured around a classroom or academic experience as opposed to the employer's actual operations, the more likely the internship will be viewed as an extension of the individual's educational experience (this often occurs where a college or university exercises oversight over the internship program and provides educational credit)." The challenge is that depending on whether you are an employer or an employee, you may interpret the role of an intern differently. And, as we saw in the Glatt v. Fox Searchlight Pictures case, if not handled properly, this issue can end up in court.

So, how will you use this information the next time your organization is looking for an intern?


This post does not constitute legal advice. The Wage and Hour Division of the Department of Labor offers information and compliance assistance on a variety of employment laws. You can call their toll-free helpline at 1-866-4USWAGE (1-866-487-9243) between 8A.M. and 5P.M. or visit their website at http://www.wagehour.dol.gov if you have questions. Always consult your attorney when making decisions of a legal nature.

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