The Basics of Following Labor Laws When Hiring Interns

Internships at for-profit entities must comply with the Fair Labor Standards Act (FLSA). The Department of Labor has issued a guide to help employers comply with the legal wage and overtime requirements of the FLSA. The law defines the term “employ” very broadly, and those who qualify as employees rather than trainees must be paid for their services in accordance with the overtime and wage provisions in the act.

Some internships in the for-profit sector may be exempt from the act’s wage and overtime requirements. This depends on the facts and circumstances of the individual case. Unpaid internships must comply with six requirements:

1. The internship provides similar training to that received in an educational environment: The more the internship is centered around the intern’s educational and academic experiences, the more likely it is to meet this requirement. Often colleges oversee unpaid internships for credit.
2. The internship is for the benefit of the intern: The internship fosters skills that can be used in a wide variety of employment settings.
3. The intern does not displace regular employees and is supervised by existing staff: If the business would have hired additional employees but for the intern, the intern is an employee. The business must not depend on the intern’s work, and the business must not temporarily augment its staff with interns. If the supervision of an intern is comparable to that of a normal employee, the intern is more likely to be viewed as an employee.
4. The employer derives no immediate benefit from the intern and may often be inconvenienced by the intern.
5. The intern is not necessarily entitled to a job at the conclusion of the internship: The internship should be for a fixed duration. It should not be used by businesses as a trial period for a potential hire.
6. The employer and the intern both understand the intern will not be paid.

If all six criteria are present, an “employment” relationship, as defined in the FLSA, does not exist and the act’s minimum wage and overtime provisions do not apply. Since this is a demanding standard to meet, the majority of internships in the private sector are considered employment.

For more information on complying with the FLSA, contact an experienced labor and employment law attorney serving Washington, D.C., Maryland, and Virginia.