Unpaid Internships

It is that time of year again where companies are bringing in seasonal assistance, many times in the form of internships.

Historically, some organizations have utilized the assistance of unpaid interns. The intent was to provide an environment where the intern could be trained and taught within their chosen field, all while helping a company reach its goals and objectives.

Recently, however, the Department of Labor has focused its attention on the unpaid student workforce, leading to several lawsuits that should remind companies to do a careful analysis before utilizing any form of unpaid work.

It is important to know that the Department of Labor has said that there are some circumstances under which unpaid internships may take place within organizations.

The following criteria should be used when making the determination to create an unpaid intern program:

 

1. The internship is similar to training which would be given in an educational environment;
2. The internship experience is primarily for the benefit of the intern;
3. The intern does not replace regular employees, but works under close supervision of existing staff;
4. There is no immediate advantage to the employer from the activities of the intern; and on occasion its operations may actually be hindered;
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.

 

Should the specific internship not meet the above criteria, compensation for the intern is required. To be clear, EctoHR Inc. rarely, if ever, encounters client situations where an unpaid internship is appropriate.

As a general rule, internships can be a great way for employers to attract and train future full-time employees. Rarely, if ever, does it make sense to not pay employees that a Company is interested in developing for the long-term.

 

For information on implementing a new intern program or strengthening an existing program, please contact Jacque Carah at 810.534.0170 or jacque@172.81.118.1.