I’m surprised this hasn’t happened sooner. The idea of unpaid internships has always been a point of contention with both the Federal government and employers. Now the government is taking notice of those who are abusing the system and violating minimum wage laws.
Theoretically, an internship (paid or unpaid) allows a student to garner experience within his/her chosen experience while in school. The reality is that while many employers do offer true opportunity to an unpaid intern, many other employers take advantage of the free labor, often assigning simple administrative tasks that, frankly, no one else wants to do, like being “…assigned to the facilities department and ordered to wipe the door handles each day to minimize the spread of swine flu.”
It’s this latter group that has caught the attention of the Federal Government via New York’s former Labor Commissioner, M. Patricia Smith.
From the NY Times:
Many regulators say that violations are widespread, but that it is unusually hard to mount a major enforcement effort because interns are often afraid to file complaints. Many fear they will become known as troublemakers in their chosen field, endangering their chances with a potential future employer.
The Labor Department says it is cracking down on firms that fail to pay interns properly and expanding efforts to educate companies, colleges and students on the law regarding internships.
The Times article also makes reference to the six federal legal criteria that govern the use of unpaid internships. What it really comes down to is the fact that no work whatsoever can be performed by an intern that is of any benefit to the company itself.
The Labor Law Blog has a great post about unpaid internships from 2007 (when it was a very hot issue in California):
Examples of internships that have been legal are where the job is a “dummy” job. For example, there was a case of an internship for working on a train. The company had the interns driving trains from one end of their yard to the other under close supervision. The moving of the trains was completely unnecessary and was just being done to train the potential employees. As such, no “work” was being performed, so the internship was legal. On the other hand, if the workers were moving the trains as part of the regular re-positioning of the trains, but were still performing it under close supervision, they would be required to be paid for the work.
I’ve always counseled my clients/employer to be very careful about unpaid internships. Because this issue plays a large part of the FLSA’s rules on minimum wage, the letter of the law must be followed absolutely. The fines for minimum wage violations can be quite exorbitant (far greater than whatever the amount the intern would have been paid) and will in fact keep growing.