Internships: To Pay or Not To Pay

Before the July 4th holiday, the Second Circuit Court negated the six prong test developed by the Department of Labor that helped identify if an internship should be paid or unpaid. Instead, this court ruled in favor of a much more relaxed set of rules stating that internships must “integrate classroom learning with practical skill development in a real world setting.”  (I have listed those 7 things below)  

Michael True, a senior associate at Messiah College’s Career and Professional Development Center says that this ruling is a game changer and will “revolutionize internships.”  

“There is a double-edged sword here for students,” said True.  “On one hand it will move employers toward making sure they are offering true work-learning experiences, not just work experiences, but on the other hand students could be forking over money to a college/university for credit and not receiving any compensation.”  

True, who runs a listserv of nearly 1200 subscribers for internships, believes that this ruling will largely negates class action lawsuits because of the flexibility the set of seven considerations allows.  

“This ruling allows for unpaid internships in business, as long as the student is the “primary beneficiary” and the experience is directly tied to the college curriculum,” said True.  

The last time paid/unpaid internships were in the news was the 2013 ruling in Glatt v. Fox Searchlight Pictures.  This is where interns who were working on the film Black Swan claimed they should have been paid wages.  The judge presiding over the case agreed citing the DOL’s 6-factor test and awarded students a summary judgment.

After the 2013 case, True says that more employers were moving toward paid internships, but he says that this could open the doors to more non-paid internships.

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1.         The extent to which the intern and the employer clearly understand that there is no expectation of compensation.  Any promise of compensation, express or implied, suggests that the intern is an employee - and vice versa.

2.         The extent to which the internship provides training that would be similar to that which would be  given in an educational environment, including the clinical and other hands-on training provided by educational institutions.

3.         The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.

4.         The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar.

5.         The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.

6.         The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.

7.         The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.

 

Source Contact Information

By: Mike True
Institution:
Messiah College
Title:
Senior Associate, Career and Professional Development Center
Email:
MTrue@messiah.edu
Phone:
717-691-6016 (office)