Privacy Policy | An intern’s rights depend on their employment status. Unpaid Interns: There is an almost bottomless list of rules that apply to employees, such as rules about minimum wage, breaks, overtime, and ensuring an environment free of harassment and discrimination. Despite several recent court cases, it is still legal to hire an unpaid intern. To increase the chances that trainee jobs will be upheld, employers should make sure that the jobs consist mainly of substantive training work, rather than just menial or administrative tasks. Downloadable Internship Program. Trainees cannot receive employee benefits. If your unpaid internship in Los Angeles fails to meet these standards, talk to a California employment law attorney about your best legal options. Many California college students and recent graduates are offered unpaid internships so they can “learn about” a particular industry. The employer cannot receive any immediate benefit or advantage from hiring the intern, i.e. By Robert S. Nelson, Esq. Given the significant risks associated with training arrangements, employers would be wise to do the following before hiring any unpaid trainees: Robert S. Nelson is the founder of the Nelson Law Group, a San Bruno, California based law firm specializing in labor and employment matters. A Summary of California Rules Governing Unpaid Interns and Trainees. Most un- or low-paid student workers in California are in fact trainees rather than interns. In addition to the wages due to the unpaid intern, employers may face potential liability for overtime and, for employees based in California, missed meal or rest periods. The Department of Labor outlines six requirements for determining an internship’s legality. All Rights Reserved. Make a valuable program with our internship handbook. Internships at the State of California are unpaid positions providing students with practical experience. At the time, some commentators stated that this might make California a more lenient place for internships. The intern(s) must be aware that the internship is unpaid. "The DOL's Wage and Hour Division appears to equate the training component of an unpaid internship with the training that an intern would receive in an educational environment," Offitt said. Do opt for a five to six-month internship. When trainee arrangement are invalidated, employers can be held liable for various damages and penalties, including: (1) the difference between what a trainee was paid per hour that he or she worked (if anything), and the applicable minimum wage; (2) time-and-a-half and/or double time pay for all hours the trainee worked in excess of 8 hours in a single day, in excess of 40 hours in a single week, or on the 7th consecutive day of work; and (3) fees ranging from $100 to $250 per each trainee who was not paid proper minimum wages and/or overtime, per each pay period that the trainee(s) was/were not properly paid. SAN MATEO, CA - JULY 16: A box for job seekers to leave resumes sits on a table at the National Career Fairs' San Francisco South Career Fair on July 16, 2012 in San Mateo, California. The U.S. Department of Labor has set requirements for determining whether an unpaid internship is legal. 2. May I hire a person as an unpaid intern? How to Hire Unpaid Interns (Legally) Before you set your bright new interns to work, here are a few things to keep in mind to avoid any missteps: According to the U.S. Department of Labor and the California Department of Labor Standards Enforcement, there are certain standards that employers must follow when taking on unpaid interns. By Robert S. Nelson, Esq. Yes and no as the law states. Return home Blog How to Hire an Unpaid Intern Without Breaking the Law. The DLSE generally disapproves of unpaid training arrangements and will invalidate those arrangements where it is either doubtful or unclear whether all of the above-noted criteria have been met. How to Hire an Unpaid Intern Without Breaking the Law. California State Universities . In valid trainee arrangements, employers will not be required to pay minimum wages and/or overtime because the trainees will not be considered to be employees, hence minimum wage and overtime rules will not apply. There is a mutual understanding that the intern will not receive wages over the course of the position. Of course, even if they don’t perform the duties of an entry-level employee — which they shouldn’t — unpaid interns can provide a great, refreshing presence in your office. [1] […] Prior to January, the DOL used a 6-part test for analyzing whether individuals could be treated as … Our California employment law attorneys have several decades of experience that we use when evaluating your case, including several years representing employers. The screening criteria is similar to that which is required for admission to an educational program. . The employer must ensure that: Failing to follow these standards may make unpaid internships illegal. Preview This premium content is for our members. Nelson Law Group. Six-Part Test to Determine Whether Hiring Unpaid Interns is Okay. Trainees also must be enrolled in educational and/or vocational programs that are relevant to their training work (e.g., newspaper interns must be presently enrolled in journalism programs) at the time the work occurs. May I hire a person as an unpaid intern? No employee benefits are received through the internship. If the intern is unpaid, it can be harder to determine. So what's the best way to ensure your internship program -- paid or unpaid -- complies with labor laws? Or click the Hiring app and then click the Add Team Member button. There is a second category of intern-like workers who, under appropriate circumstances, can also be exempt from state and federal overtime and minimum wage requirements. With a written request to hire an unpaid intern, the Department will issue an opinion about the legality of a particular internship program. But the internship must be more akin to a training program than employment. Download Now. It should be noted that unpaid internships often lead to long and lucrative careers in a person’s chosen field. Whether you are considering a California unpaid internship or are already an unpaid intern, it is vital to know what your employer’s obligations are when accepting your labor without paying for it. The California unpaid internship will only receive approval if it meets the state requirements, which include: A common concern both the federal and California government have with unpaid internships is that the internship must be of benefit to the intern, with the employer gaining no benefit or even suffering some minor loss of revenue or resources on behalf of the intern. Once you answer all the necessary questions, you can then turn to intern recruitment. In fact, unpaid interns should not do any task that contributes to the company's operations, such as answering the phone, responding to emails, or documenting inventory. Enter the intern's employment information. In a recent Craigslist want ad, the poster warned that candidates for a vacant internship position needed to be able to travel internationally. There was only one catch: it had to be on the intern… The position must train the intern to work in a given industry, not just a specific company. Since coverage for unpaid interns can vary from state to state, it’s best to … It’s easy to see why – internships give students and other young adults a way to obtain real-time, hands-on experience in fields they hope to pursue. Know the Department of Labor's six legal criteria. Often coordinated with high schools and trade associations, these programs may allow a business to pay the worker 75% of the minimum wage while working on a part-time basis. Minor and/or unintentional non-compliance with the sophisticated laws and regulations that apply to intern relationships can subject employers to liability for overtime and/or minimum wage violations. Like all employees, interns require some time and training to … However, in California the existing law states that a worker can be classified as an intern (and not be paid) only if all of the following six requirements are satisfied: Factor 1: Training similar to that provided at a vocational school. Internships at the State of California are unpaid positions providing students with practical experience. Unpaid internships that operate within federal and state guidelines can be beneficial to both the intern and the employer. You must be able to answer yes to all six factors to have a legal unpaid … When recruiting, the employer must be upfront about the unpaid nature of the position. Hiring an intern is a great way to tap into talented students who haven’t yet graduated from college. Fill out our case review form for free legal advice about the legality of a California unpaid internship. For immediate access, join online or by phone at (800) 649-4921. An employment law attorney in Los Angeles can help you determine whether a California unpaid internship violated federal or state labor laws. The U.S. Labor Department rolled out new guidelines this month that make it easier for companies that want to hire interns but don’t want to pay them. “Lunch and…[school] credits. The intern’s work does not displace the work of regular employees, and his or her work must be supervised. Consequently, the California Division of Labor Standards Enforcement (“DLSE”), which enforces the state’s wage-and-hour laws, will carefully scrutinize trainee arrangements to ensure that they are really valid work-for-education exchanges, rather than just pretexts by which employers can avoid having to pay employees. Sign In Below. Before your company takes on an unpaid intern, you would be well-advised to consult with a California employment compliance attorney to make sure that everything is handled correctly. A Summary of California Rules Governing Unpaid Interns and Trainees. According to the U.S. Department of Labor and the California Department of Labor Standards Enforcement, there are certain standards that employers must follow when taking on interns. Business California Are Unpaid Internships Legal in California? About; Wage Requirements; March 22, 2013 Graphic Design Intern “MARAD Design Company” in the Bay Area placed a Craigslist ad looking for a graphic design intern “ready to jump in on anything and everything.” The business is looking for someone who is “comfortable working independently” and on an “unpaid” basis. Essentially, both the DOL and the California DLSE maintain that for an internship to be unpaid, it must be educational and predominantly for the benefit of the intern, and not the employer. If Smith Accounting hires an unpaid intern, they should expect the intern to mostly job shadow an employee. In a recent Craigslist want ad, the poster warned that candidates for a vacant internship position needed to be able to travel internationally. Already a Member? The Low Down on Internships. When can I hire an unpaid intern or volunteer: The six-factor test is primarily used in the, “for profit,” private sector. According to the new Fact Sheet, for a business to qualify (legally hire “unpaid … The rules provide that no one element controls, and it is not necessary for an intern to meet all seven elements to properly qualify as an unpaid intern. In practice, courts look at each situation on a case-by-case basis. As a best practice for small businesses, Andy Gale highly recommends that employers should meet the six standards set by the Department of Labor for hiring unpaid interns. Employers often have legal questions about how to hire an intern, especially about whether to hire paid or unpaid interns.While hiring interns, employers should look up the federal Fair Labor Standards Act (“FLSA”), which is the federal wage and hour law that sets forth the legal requirements for compensation for employees, including paid interns, minimum wage and overtime pay. The intern receives general, rather than specific job training. This is not an “or” list, but an “and” list. To reduce the risk, it’s essential to hire an HR consultant who can guide you through the process and help you craft an internship program that’s compliant with both state and federal laws. On January 5, 2018, the United States Department of Labor (DOL) issued a new standard for determining whether an individual could be classified as an unpaid intern. [1] Certain school-teachers-in-training are also considered to be interns, per se. But just because a person is in college doesn’t mean they have to be an intern. 4. How to Hire an Intern. Small Business California . The position exists for the intern’s benefit. All Rights Reserved. State and local government agencies and non-profit organizations can generally utilize interns or volunteers without an obligation to pay them under the FLSA. California, for one, has detailed guidelines for the hiring of unpaid interns, a criteria which is almost identical to the federal list. How to Hire Unpaid Interns the Right Way. However, other state laws apply more stringent standards in considering the bona fides of an unpaid internship. On April 7, 2010, the California Division of Labor Standards Enforcement (DLSE) issued an opinion letter addressing the requirements employers must meet in order to have unpaid interns in compliance with California law. Employers in California must follow two sets of standards when it comes to internships: federal and state. The intern(s) must be aware that the internship is unpaid. California used to have a longer list of requirements employers must follow to stay out of legal trouble. Since coverage for unpaid interns can vary from state to state, it’s best to check with your insurer or agent. © 2020 Kesluk, Silverstein, Jacob & Morrison, P.C. It's best to reach out to local colleges and universities and post on their job boards. Already a Member? The employer cannot derive any immediate advantage from the work of the trainees (in fact, employers’ operations should to some extent be impeded by the trainees’ presence). Watching Businesses in California Who Hire Unpaid Interns. Money-whiners and over-qualified individuals need not apply.”. Employers with misclassified unpaid interns face potential liability for unpaid wages and violations relating to failure to pay minimum wage, which could be significant for a full-time intern. And while this arrangement may sound great for employers, it is in fact fraught with potential problems and vulnerabilities. Here is how to hire a paid or unpaid intern in Zenefits. ... ABOUT THE PROGRAM . But you may legally hire an unpaid intern if you can show the intern is the “primary beneficiary” of the relationship. To determine who is the primary beneficiary, courts take into consideration the extent to which: The intern understands they will not receive compensation and does not expect compensation. If the employer is the primary beneficiary and gains through the intern’s work product to a substantial degree, the intern must be viewed as an employee, and compensation is required. Unpaid Internships in California have seen a steady increase over the years. Scroll through other postings and a similar pattern will emerge: Interns are expected to possess all-star abilities and put forth Herculean effort, yet they are offered little to no pay in return for their work. The Federal court adopted what is referred to as the “Primary Beneficiary Test” to determine this issue under the Fair Labor Standards Act (“FLSA”). However, it c… Some state laws (such as those in California) apply very similar standards to the aforementioned federal requirements in determining if an individual is an employee or an intern. Now that we represent workers, we know what your employer will say to limit liability how to counter those claims. In fact, California adds five requirements to the six-part Department of Labor test: 1. So if you want to pay an intern a stipend for his or her work, it has to be equal to the minimum wage that the intern would have received for the hours worked. Trainees must not displace regular employees in performing the work. But what about interns, who work at companies without pay as part of a training or educational program? Posted on March 2, 2018. Nelson Law Group. The position must take place as part of an educational curriculum, which requires the participation of a school or similar institution. It should be noted that unpaid internships often lead to long and lucrative careers in a person’s chosen field. When you hire interns, you're investing in your business, as well as in new talent that may improve how your company functions. So if you’re thinking of using an internship as a fast way to find cheap labor, you might want to rethink things. All California businesses seeking to hire interns must submit an outline of the proposed internship to the DLSE. You can even hire unpaid interns as long as you meet FLSA guidelines when setting up your internship program. Sign In Below. These workers, called “trainees,” may be in any field or profession, not just medicine. Furthermore, the California Division of Labor Standards Enforcement (DLSE) has in the past set forth five (5) additional factors that help determine whether an unpaid internship violates California labor laws: Any internship should be part of an “educational curriculum”; The interns should not receive “employee benefits”; 1. Determine the best time to hire an intern using the table below. Is it Okay to Hire Unpaid Interns? The internship is part of an educational curriculum. The intern is not necessarily entitled to a job at the conclusion of the internship; and; The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship. Intern Start Date . They also offer large companies a nearly endless source of free labor to stock their offices with. The screening process for the training job cannot be the same as that used for regular employees (i.e., applicants should not think they are applying for paying jobs). 4. 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