Have you ever thought about saving your company money by offering a student an unpaid internship instead of hiring another employee?
Be aware that if certain requirements are not met, the Department of Labor may consider your “intern” to be an employee, subject to minimum wage and overtime laws.
According to the Fair Labor Standards Act (FLSA), the following six criteria must be met when determining intern status:
- The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment
- The internship experience is for the benefit of the intern
- The intern does not displace regular employees, but works under close supervision of existing staff
- The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded
- The intern is not necessarily entitled to a job at the conclusion of the internship
- The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship
All of the above factors must be met in order to determine internship status.
If all of the above factors are met, an employment relationship does not exist under the FLSA, and the Act’s minimum wage and overtime provisions do not apply to the intern.
According to the Department of Labor, if the interns are engaged in the operations of the employer or are performing productive work (for example, help with filing, performing other clerical work, or assisting customers), then 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 the FLSA’s minimum wage and overtime requirements because the employer benefits from the intern’s work.
In other words, you can’t have your cake and eat it, too.
Even if you own a bakery.
Call managestaff with questions regarding internships. We’ll help.
It’s what we do.
image: Stuart Miles/freedigitalphotos.net