While it may not seem like it with the current weather patterns shifting back and forth from mild to cold, including a little snow, the summer season is just around the corner. And with that comes the arrival to the workforce of students looking for a bit of solid experience between school years. Sometimes this experience is paid work and sometimes it is not. For those employers considering the unpaid internship approach, beware. Simply calling someone an intern and putting them to work for free isn't necessarily the right approach and may lead to a bill coming due later for unpaid wages.
The DOL has a six-factor test for making determinations about whether an internship meets the exclusion and can be unpaid. Those factors include:
- Is the training similar to the training the individual would get in an educational atmosphere;
- Is the experience for the benefit of the intern;
- Does the intern replace a regular employee and work under close supervision;
- Does the employer gain any immediate advantage from the training program;
- Is the intern entitled to a job at the end of the internship; and
- The employer and intern understand the intern will be unpaid.
If the employer can sufficiently meet all the factors listed above, then the intern can be unpaid. Employers should keep in mind, however, that this exclusion is very narrowly interpreted. For an intern to be truly unpaid, it almost needs to be a situation where the employer suffers an inconvenience and expense just to provide the program. If the employer is deriving some productive work or benefit from the situation, it is almost certain to fail the DOL test.