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Wage and Hour Issues for Employers: Do I Have to Pay Our Summer Intern?

Posted by Maureen B. Heffernan | Mar 14, 2016 | 0 Comments

Maureen HeffernanIf your company is considering hiring unpaid interns this summer, you should keep in mind that there are certain requirements that must be met before you can treat an internship as an unpaid position.

Generally speaking, interns who receive training for their own educational benefit may be considered “unpaid interns.” However, the Department of Labor, which is the federal agency that enforces the federal wage and hour laws has identified the following six criteria that must be met in order to have an unpaid intern in your workplace:

  • The internship, even though it includes performance of the actual operations of your workplace, is similar to training which would be given in an educational environment;
  • The internship experience is clearly for the benefit of the intern;
  • The intern does not displace regular employees, but does work 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 even be impeded;
  • The intern is not necessarily entitled to be hired into a regular job at the conclusion of the internship; and
  • The employer and the intern both understand that the intern is not entitled to wages for the time spent in the internship. (To meet this part of the test, it is recommended that a written acknowledgment be obtained from the intern).

You should apply this six-factor test to each position being considered in light of the specific facts and circumstances surrounding that position.

Remember that all of the above factors must be met for the internship to be designated as an unpaid position.  If any one of the factors is in question or is not met, it is likely that both the minimum wage and the overtime provisions of federal and/or state wage and hour laws will apply to the position in question.

If you have questions about any of these issues, feel free to contact Maureen B. Heffernan at 712-252-0020 or email Maureen at [email protected]

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About the Author

Maureen B. Heffernan

EDUCATION University of Iowa, B.B.A., 1981 University of Iowa College of Law, J.D., with distinction, 1985 ASSOCIATIONS The Iowa State Bar Association Woodbury County Bar Association American Bar Association American Health Law Association Iowa Society of Healthcare Attorneys Iowa Council of Sch...

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