Interns: To pay or not to pay…

Ahh summer. Barbeques, pools, tan lines and… internships. Now is the time of year when many young people start taking internship positions in companies to hopefully propel forward their experience in their chosen industry, as well as possibly make a few networking connections.

As a business owner, an intern might be something your company is interested in. But, you may be unsure of how to handle the whole legal side of an internship. Do you know when to pay them or when to make it an unpaid internship? Here is some legal criteria for you to defer to when it is ok to make an internship unpaid:

  1. The internship, even though it includes actual operation of the facilities of the employer, is similar 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.

(U.S. Department of Labor Wage and Hour Division, April 2010)

So, if the internship is able to fall under all of these six factors, you can establish that an employment relationship does not exist between your company and the intern, and therefore minimum wage and overtime requirements are no longer applicable.

Bringing an intern to the table could be a great experience for both parties involved. Just be sure that you, and the intern, are clear on expectations and the overall understanding of the arrangement. Happy summer!

 

 

Let’s Get Legal: Guidelines for Paid or Unpaid Internships

Hoyt, Elizabeth. N.p.. Web. 8 Jul 2013. <http://college.monster.com/news/articles/2185-lets-get-legal-guidelines-for-paid-or-unpaid-internships>.

 

New Department of Labor Guidelines on Internships: How to Decide if an Internship Needs to be Paid or Not

Loretto, Penny. About.com Guide. Web. 8 Jul 2013. <http://internships.about.com/od/internships101/a/departmentoflaborsnewguidelinesforinterns.htm>.

 

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