HR: Are Unpaid Interns Legal?
For ages, budget conscious employers have been using unpaid interns to staff their workplaces- providing valuable opportunities and experience to students, while keeping costs down. If your organization is considering using unpaid interns, you might want to proceed with caution, as many unpaid internship programs are in violation of labor laws.
Under the Fair Labor and Standards Act there are very strict guidelines that employers must adhere to in order for an internship to be "legally" unpaid. Failing to comply with these guidelines can expose businesses to minimum wage and overtime law violations. These violations could potentially cost a company thousands of dollars in unpaid wages & overtime fines, legal fees and other costs.
The US Department of Labor has compiled a list of 6 criteria. ALL 6 criteria must be met in order for the internship to qualify as unpaid. Basically, the guidelines state that unpaid interns can not do any work that provides an immediate benefit to the employer or contributes to an organization's operations. This would include tasks that help run a business- such as filing papers, documenting inventory, answering email, organizing calendars, writing reports and market research. To ensure compliance, employers would have to structure the internship so the worker receives the full benefit of the experience - create work that provides no value to the company?
Typically, internships have been a win-win situation for both students and employers. Students gain valuable business experience, build their resumes and learn the ropes. Businesses on the other hand benefit from an extra set of hands in the office, fresh new ideas and time to evaluate the worker for future employment. Limiting these opportunities does a great disservice to both students and employers.
As it makes no sense at all for employers to use interns to do work of "no value", I think most people would agree that the Department of Labor needs to re-evaluate their position on unpaid internships. What's next - mandating that volunteers must be paid??