Several recent lawsuits are raising questions about interns and when they must be paid as employees pursuant to the Fair Labor Standards Act (FLSA). The FLSA provides that all workers must be compensated for their work – earning at least minimum wage and for non-exempt workers, overtime pay at a rate of one and one-half times their standard hourly wage for all time worked in excess of forty hours in any one work week. However, a very narrow set of circumstances allows employers to avoid paying some workers such as summer interns. The rules are very strict though, and companies often mistakenly (or in some situations, intentionally), violate these rules and fail to pay workers who are rightfully entitled to compensation.
In one case, Glatt v. Fox Searchlight Pictures, interns on the set of “Black Swan” successfully sued Fox for back wages. The interns had not been paid, but performed work that would typically be compensated. In another case,
Wang v. Hearst, the court determined that the unpaid internships were allowable because the work the interns provided was for their “primary benefit” rather than that of the employer.
The factors used to determine whether an intern must be paid include:
• Whether training is similar to that in vocational school • If the internship primarily benefits the employer or the intern • Whether the interns displace paid employees • Whether the intern is entitled to a job upon completion • Whether the intern understands that he or she will/will not be compensated for working.
A third pending case is now examining whether these factors are consistent and should remain the test. Further, when difficult economic times exist, many people are willing to work for free in order to “get their foot in the door.” As a result, this creates a situation where unscrupulous employers may take advantage of interns and others willingness to work without wages.
If you have questions concerning your right to receive pay for your internship, or any other wage and hour concern, please contact the dedicated Atlanta wage and hour attorneys at Buckley Beal LLP for an immediate case evaluation.