Overtime Laws, Dangers in Hiring Interns, Labor Laws Attorney

DANGERS IN HIRING INTERNS

Even though many a company has hired interns for free without problem it does not mean that hiring interns is without the potential for serious consequences. Interns are often hired at no pay, but interns have the right to compensation in many instances. To avoid liability the intern has to receive training that is for the benefit of the intern not the employer. The intern has to be an actual trainee and the work the trainee performs has to serve his or her interests. The courts look at whether the intern impedes the employer’s operations or facilitates the employer’s operations.

The federal Department of Labor has six factors that are used to determine if the intern is an intern or an employee. These factors are as follows:

(1) The training is similar to that which would be given in a vocational school;

(2) The training is for the benefit of the trainee;

(3) The trainee does not displace a regular employee and works under close observation;

(4) The training provider derives no immediate benefit from the trainee, in fact, its operations

may be impeded;

(5) The trainee is not entitled to a job at the completion of the training;

(6) The employer and the trainee understand that the trainee is not entitled to wages; however, a

stipend may be permitted.

Adhering to this factors does not necessarily mean an employer is protected in the event of a dispute, the employer may still be found liable for labor violations depending on the circumstances of the specific case.

The California Department of Labor adds additional factors that need to be taken into consideration these area s follows:

(7) The training should be part of an educational curriculum.

(8) The students should not be treated as employees for such purposes as receiving benefits.

(9) The training should be general in nature, so as to qualify the students for work for any

employer, rather than designed specifically as preparation for work at the employer offering

the program

(10) The screening process for the program should not be the same as for employment

(11) Advertisements for the program should be couched in terms of education rather than

Employment.

If the intern files a claim and it is determined that the intern is an employee the employer then becomes liable for all employment related issues such as minimum wage, overtime, meal and rest period violations, I-9 filing, workers’ compensation insurance and other related labor and employment laws. Great caution should be exercised when hiring an intern and it is probably best to treat the intern as employee and comply with all labor and employment laws to avoid the penalties associated with violating the law.

Legal Authorities:

Walling v. Portland Terminal Co., 330 U.S. 148 (1947)

Marshall v. Allen-Russell ford, Inc., 488 f. Supp. 615 (E.D. Tenn. 1980);

Donovan v. American Airlines, Inc., 686 F.2d 267 (5^th Cir. 1982);

U.S. Dep’t Labor Op. Ltr Wage and Hour Adm. WH-229

U.S. Dep’t Labor Op. Ltr Wage and Hour Adm. WH-185

U.S. Dep’t Labor Op. Ltr Wage and Hour Adm. WH-423

Reich v. Parker Fire Protection District, 992 F.2d 1023 (10^th Cir. 1993)

McLaughlin v. Ensley, 877 F.2d 1207 (4^th Cir. 1989)

Hall v. Delaware Council, 780 F. Supp. 241 (D.C. Del. 1992)

St. Germain v. Simmons Airline, 930 F. Supp 1144 (N.D. Tex. 1996)

Cuddeback v. Flordida Bd. Of Education, 381 F.3d 1230 (11^th Cir. 2004)

Marshall v. Baptist Hospital, 473 F. Supp. 465 (M.D. Tenn. 1979)

Cal. Div. Of Labor Standards Enforcement, Opn. Ltrs. 1998. 11.12 and 1996.121.30

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