New Criteria for (un)Paid Internships

December 10th, 2013

Internships have long been an opportunity for young workers and students to gain experience in the business world. Ironically, as the apprenticeship experience became more official, some of its benefits fell by the wayside, but recent changes in the federal guidelines for internships have sought to bring the value back.

Historically, young people studied under a master for years before joining a guild, or later, a union. It wasn’t until the 1960s that formal internships evolved as part of the educational experience. By 2009 the term “intern” was often being used as code for free labor. Though legitimate internships did still exist, the Department of Labor found an increased number of young people being brought on without pay to do menial tasks with little or no educational value.

To preserve the internship as a respected training experience, the U.S. Department of Labor’s Wage and Hour Division (WHD) developed six factors to evaluate whether a worker qualifies as a trainee or intern:

  1. The training, even though it includes actual operation of the facilities of the employer, is similar to what would be given in a vocational school or academic educational instruction.
  2. The training is for the benefit of the intern.
  3. The interns do not displace regular employees, but work under their close observation.
  4. The employer that provides the training derives no immediate advantage from the activities of the interns, and on occasion the employer’s operations may actually be impeded.
  5. The interns are not necessarily entitled to a job at the conclusion of the training period.
  6. The employer and the interns understand that the interns are not entitled to wages for the time spent in training.

If all of the above factors are met, then the worker can be considered a trainee or intern and the provisions of the Fair Labor Standards Act do not apply. If you’re considering bringing on unpaid trainees or interns, be sure to review the new criteria carefully. More detailed information on the six points above can be found by clicking here.

Of course, the value of paid, part-time and seasonal employees should not be overlooked. It makes sense, when you pay top dollar for professionals in your field, to not take up their time with menial tasks. Hiring a student for a few hours a week to help execute the operations of your facility is a cost-efficient option that also gives the worker valuable experience in their chosen field.

As employers, we are fortunate to have a wide array of options available to us. With a bit of careful planning we can make the most of our workforce to maximize productivity while training the up and coming leaders of the future.

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