Unpaid Intern: The Unpaid Employee?


Unpaid interns: They are as ubiquitous as taxis in New York and suntans in Los Angeles, especially in the entertainment, media, and fashion industries. Indeed, for many college students and graduates, unpaid internships represent a door to possible future employment in these competitive industries.

The Federal Fair Labor Standards Act (FLSA) and most if not all states require employees to be paid a minimum wage for all hours worked, and overtime for all hours worked over 40 in a week (some states also require overtime pay for all hours worked over 8 in a single day). While the FLSA and
some state wage laws make an exception for unpaid internships, the exception is narrow. According to the U.S. Department of Labor, the unpaid internship is lawful only if it meets the following criteria:

  • 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;
  • The internship experience is for the benefit of the intern;
  • The intern does not displace regular employees, but works under close supervision of existing staff;
  • 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;
  • The intern is not necessarily entitled to a job at the conclusion of the internship; and
  • The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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