Not Paying Interns? You Should Reconsider

pay your interns button — Pay Your Interns

Q: I heard about the federal court ruling last Friday that found an employer had violated federal minimum wage law by not paying their interns. My company has about 10 people, five of us are employees who’ve been around a while and the others are unpaid interns that come and go every few months. Now I’m worried that maybe we should be paying them. How do we know if we are within the law?

A: The best way to figure out whether or not you should be paying interns is to use the six criteria outlined by the Department of Labor in Fact Sheet #71. If you are deriving “any immediate benefit” from their work (your phones are being answered, your paperwork is being filed, they’re assisting customers) then they should be paid. In fact, “if an employer uses interns as substitutes for regular workers or to augment its existing workforce during specific time periods, these interns should be paid”. But wait there’s more: “If the employer would have hired additional employees or required existing staff to work additional hours had the interns not performed the work, then the interns will be viewed as employees and entitled to compensation”.

You may ask, but isn’t the intern benefiting from the experience also? To which the DOL responds, “the fact that they may be receiving some benefits in the form of a new skill or improved work habits will not exclude them from minimum wage” because the employer benefits from the interns’ work.

If any of this applies to your interns, you should be paying them. And you wouldn’t be alone. An estimated half of all internships are unpaid, and I’d take a wild guess that 80% of those are breaking the minimum wage law. But why is it so widely accepted? Because so many respectable companies have been doing it for years without consequences. Until now. It took a 42 year-old accounting intern named Eric Glatt, -who switched careers and could afford to burn bridges- to bring a lawsuit and challenge what he calls “a form of institutionalized wage theft”.

I do commend you for asking yourself the question. Hopefully many more employers will also. Find the DOL fact sheet at www.dol.gov/whd/regs/compliance/whdfs71.pdf