Posted July 22nd, 2012 in Legal Insights

Unpaid Interns Becoming an Endangered Species?

Historically, unpaid internships have offered a way for new grads to get a foot in the door or otherwise gain relevant work experience, while providing employers an eager pool of candidates and a means to evaluate potential hires, particularly in a down economy. But a Department of Labor (DOL) fact sheet released in spring 2010 further clarifies the Fair Labor Standards Act (FLSA) of 1938 saying, among other requirements, that unpaid internships are allowable only if “they are educational and benefit the intern and not necessarily the employer.” Cases in recent months are putting this issue to the test, including a class action lawsuit brought by unpaid interns working on Fox Searchlight Pictures’ movie, “The Black Swan,” claiming that they were completing many of the same duties as paid employees. Nilan Johnson Lewis Associate Sejal Desai Winkelman observes that these stringent DOL criteria will mean fewer opportunities and experiences for young talent looking to build their resumes, but cautions employers to tread very carefully if considering internship arrangements that don’t involve minimum wages. “These recent cases serve as clear warning signs. When you’re developing an internship, remember to carefully design the opportunity to maintain a training focus and to closely administer the position.” Contact Sejal Winkelman at (612) 305-7692 or swinkelman@nilanjohnson.com.