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- Job title and itemized description
of tasks.
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- Department(s) assigned to.
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- Length of internship (Months and
time of year.)
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- Hours/Days of internship.
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- Credit bearing (college or high school
credit).
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- Paid or non-paid (See FLSA
regulation below.)
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- Rotation and flexibility.
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FLSA determines if ‘intern’ is actually ‘employee’
By Naomi Cossack
Q:
Our company is considering implementing an
internship program. We have been told that interns do not need to be paid.
Are we legally required to pay students enrolled in an internship?
A: While there is no question that an internship can provide great
benefits to both employers and students alike, many employers find
themselves faced with the question of whether or not interns need to be
paid.
The answer to that question depends on whether or not the student is
considered an employee subject to the requirements of the Fair Labor
Standards Act (FLSA). The FLSA requires employers to pay all employees at
the rate of not less than current minimum wage; however, the Department of
Labor (DOL) has developed criteria to assist employers in identifying when
a student is not considered an employee within the meaning of the FLSA.
According to the DOL, a student or trainee will not be considered an
employee if all of the following criteria are met:
-
The training, even though it includes actual operation of
the facilities of the employer, is similar to that which would be given
in a vocation school.
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The training is for the benefit of the trainees or
students.
-
The trainees or students do not displace regular
employees, but work under their close observation.
-
The employer that provides the training derives no
immediate advantage from the activities of the trainees or students, and
on occasion the employer’s operations may actually be impeded.
-
The trainees or students are not necessarily entitled to
a job at the conclusion of the training period.
-
The employer and the trainees or students understand that
the trainees or students are not entitled to wages for the time spent in
training.
A
student not meeting all of the above criteria will in fact be considered
an employee covered by the FLSA and therefore the employer is legally
obligated to provide compensation for his or her services. As with all
matters requiring legal interpretation, it is always wise for employers to
work closely with their own legal department to ensure compliance with
federal and any other applicable state laws.
Employers implementing an internship program can also view additional
resources such as white papers, forms, etc., via the
SHRM Internship Toolkit.
Naomi Cossack is the manager of online content in SHRM’s Knowledge
Integration Department.
Please Note:
This material is provided as general information and is not a substitute
for legal or other professional advice.
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