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Internships: Paid or Unpaid?

July 07, 2014 by Kathryn Carlson


With daydreams about laying by the beach on hot summer days looming in the near future, comes the burning staffing question: are we going to need student interns who are on their summer break and (quite possibly more important) do we have to pay them?

As defined by the Fair Labor Standards Act (FLSA), internships with “for-profit” private companies are most likely viewed as employment (i.e. “suffer or permit to work), thus being considered non-exempt from minimum wage and overtime compensation requirements. However, there are a few circumstances where internships in “for-profit” private companies may be unpaid. The Department of Labor applies the following six criteria when determining whether an unpaid internship is legal:

  1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training in which would be given in an educational environment;
  2. The internship experience is for the benefit of the intern;
  3. The intern does not displace regular employees, but works under close supervision of existing staff;
  4. 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;
  5. The intern is not necessarily entitled to a job at the conclusion of the internship; and
  6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

Are you abiding by the Fair Labor Standards Act with your summer interns?

Posted in: Human Resources Management Tags: FLSA, Internship, Paid, Standards, Unpaid