Protections against workplace sexual harassment provided by the New York City Human Rights Law (NYCHRL) and the New York State Human Rights Law (NYSHRL) do not apply to unpaid interns, a federal court has ruled in Wang v. Phoenix Satellite Television US, 2013 U.S. Dist. LEXIS 143627 (S.D.N.Y. October 3, 2013). This ruling, which is the first to interpret the NYCHRL's hostile environment protections as to unpaid interns, highlights that an intern's compensation (or lack thereof) may be a determining factor.
Lihuan Wang became an unpaid intern with Phoenix Satellite Television US, Inc., under the sole supervision of Zhengzhu Liu. Mr. Liu was responsible for supervising the Washington, DC and New York City bureaus, as well as for hiring employees and interns. Notably, the supervisor performed these functions in his sole discretion, without the assistance of an HR Department. The intern alleged that she was subjected to sexual advances by her supervisor:
Amounting to a hostile work environment;
Resulting in quid pro quo harassment; and
Ultimately leading to retaliation.
In addition, the intern claimed that the employer failed to hire her because of the supervisor's discriminatory bias against her.
The employer asked the court to dismiss the intern's claims because she was not protected under the NYSHRL or the NYCHRL because of her status as an unpaid intern. The employer argued that equal employment opportunity (EEO) laws protect employees from discrimination, harassment, hostile environment and retaliation, and unpaid interns, by their very nature, are not employees.
However, the intern argued that under the 2005 Restoration Act, which amended the NYCHRL, the court should interpret the term employment relationship more expansively by using a balancing test. The balancing test proposed by the intern considers not only whether an intern is compensated, but also whether the supervisor had the power to hire, fire and control the tasks the intern performed.
The court rejected the intern's claims, reasoning that compensation is essential to the employment relationship, and because the intern was not paid, then there was no employment relationship for purposes of the EEO laws. In support of its decision, the court relied on other court decisions in which other unpaid workers, such as unpaid volunteers, were ruled to be outside the scope of the NYSHRL's protections.
However, the unpaid intern's case will continue. The court allowed the intern's failure to hire claims to proceed, although she did not formally apply for a position with the employer. The court reasoned that the NYSHRL and the NYCHRL both protect failure to hire claims that are based on informal hiring processes and procedures.