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A Better Partnership

Publications

Jun 2012
18
June 18, 2012

Interns, Do We Have to Pay Them?


Summer is here and it’s the time of year when we hear the pitter patter of eager little feet running around the office work place. And those eager little feet are attached to eager little interns. Very often those eager little interns are not getting paid. And this is no surprise to anyone. Want to know what might be a surprise? Could be these eager little interns should be getting paid and if they are not, you may be violating the Fair Labor Standards Act (FLSA).

So here is the big question: Does your summer internship program violate the FLSA? Could be. You see, most interns are unpaid, right?  But, did you know that it’s almost impossible for a for-profit company to have an unpaid internship program that does not violate the FLSA? That’s right. Almost always, interns must be paid. You can pay them minimum wage if you want, but you’ve got to pay them.

WH Publication 1297 and Section 10b11 of the Department of Labor (DOL) Field Operations Handbook describe the following six situations in which you DO NOT have to pay interns (what the DOL calls trainees):
 
  1. The training, even though it includes actual operation of the facilities of the employer, is similar to what would be given in a vocational school or academic educational institution;
  2. The training is for the benefit of the trainees;
  3. The trainees do not displace regular employees, but work under their close observation;
  4. The employer that provides the training derives no immediate advantage from the activities of the trainees, and on occasion the employer’s operations may actually be impeded;
  5. The trainees are not necessarily entitled to a job at the conclusion of the training period; and
  6. The employer and the trainees understand that the trainees are not entitled to wages for the time spent in training.

In order for an internship program to be an unpaid program, you have to meet all six of these requirements. If you miss one of these requirements and you are not paying your interns, you can be found liable. Liable for what you ask? Possibly owing double back pay for three years for all unpaid interns and the interns’ attorney fees. Realistically, very few internship programs are going to meet all six of the DOL requirements.

In 2010 the DOL issued a fact sheet on when interns need to be paid. You can see it at http://www.dol.gov/whd/regs/compliance/whdfs71.htm.

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