Category Archives: Summer interns

SUMMER INTERNS: TO PAY OR NOT TO PAY, THAT IS THE QUESTION

Summer is upon us — school is out and it was a toasty 107 degrees in Phoenix this past weekend.  Ouch.

Summer internships can take the sting out of the heat for students by giving them the opportunity to gain valuable experience in the workplace.  In turn, businesses benefit from summer interns; it is refreshing to have up and comers in the workplace — up and comers who may one day become employees.

This HR Law Insider edition examines when employers are required to pay summer interns, so that employers are not stung by the heat of a Department of Labor investigation.

FACTORS GOVERNING WHETHER SUMMER INTERNS MUST BE PAID

The determination of whether an internship or training program requires participants to be paid depends upon all of the facts and circumstances of each program.

The United States Department of Labor applies the following six criteria to determine whether an employer is not required to pay a summer intern:

  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.

If all of these are met, an employment relationship does not exist under the Fair Labor Standards Act (FLSA), and minimum wage and overtime provisions do not apply to the intern. Conversely, if one or more of these are not met, an “intern” may be an employee and entitled to rights as an employee — including the right to earn a minimum wage, among other things.

WHO DOES THE SUMMER INTERNSHIP BENEFIT?

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 more the internship provides the individual with skills that can be used in multiple employment settings, as opposed to skills particular to one employer’s operation, the more likely the intern would be viewed as receiving training.  Under these circumstances the intern does not perform the routine work of the business on a regular and recurring basis, and the business is not dependent upon the work of the intern.

On the other hand, if the interns are engaged in the operations of the employer or are performing productive work (for example, filing, performing other clerical work, or assisting customers), then the fact that they may be receiving some benefits in the form of a new skill or improved work habits will not exclude them from the FLSA’s minimum wage and overtime requirements because the employer benefits from the interns’ work.

IS THE INTERN MERELY A SUBSTITUTE FOR OTHER EMPLOYEES?

If an employer uses interns as substitutes for regular workers or to augment its existing workforce during specific time periods, these interns should be paid at least the minimum wage and overtime compensation for hours worked over forty in a workweek.  If the employer would have hired additional employees or required existing staff to work additional hours had the interns not performed the work, then the interns will be viewed as employees and entitled compensation under the FLSA.

Conversely, if the employer is providing job shadowing opportunities that allow an intern to learn certain functions under the close and constant supervision of regular employees, but the intern performs no or minimal work, the activity is more likely to be viewed as a bona fide education experience.  On the other hand, if the intern receives the same level of supervision as the employer’s regular workforce, this would suggest an employment relationship, rather than training.

MISCELLANEOUS

The internship should be of a fixed duration, established prior to the outset of the internship.  Further, unpaid internships generally should not be used by the employer as a trial period for individuals seeking employment at the conclusion of the internship period.  If an intern is placed with the employer for a trial period with the expectation that he or she will then be hired on a permanent basis, that individual generally would be considered an employee under the FLSA.

CONCLUSION:  THERE AIN’T NO CURE FOR THE SUMMERTIME BLUES

Now that you are armed with the knowledge of whether summer interns must be paid, be sure to (1) stay hydrated, (2) apply generous portions of sunscreen, and (3) enjoy The Who’s ode to summer.  Actually, The Who did not write Summertime Blues, which song’s awesome lyrics and little known writer appear below the video.

Well, I’m a gonna raise a fuss, I’m a gonna raise a holler
I’ve been working all summer just to try and earn a dollar
Well, I went to the boss, said I got a date
The boss said “No Dice, son, you gotta work late”

Sometimes I wonder, what am I gonna do
There ain’t no cure for the summertime blues

Well, my mom and poppa told me, “Son you gotta earn some money
If you want to use the car to go out next Sunday”
Well, I didn’t go to work, I told the boss I was sick
He said “You can’t use the car ’cause you didn’t work a lick”

Sometimes I wonder, what am I gonna do
There ain’t no cure for the summertime blues

Gonna take two weeks, gonna have a fine vacation
Gonna take my problems to the United Nations
Well, I went to my congressman, he said, quote
“I’d like to help you son but you’re too young to vote”

Sometimes I wonder, what am I gonna do
There ain’t no cure for the summertime blues

Songwriters
COCHRAN, EDDIE/CAPEHART, JERRY