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More Labor Department scrutiny expected on unpaid internships

A couple of years ago, unpaid interns in the movie and media industries began making noises about whether those internships were all they were promised to be. Everyone understands that it’s hard to get jobs in these popular industries and that unpaid internships are a way to get your foot in the door. After some of those interns found themselves unemployed anyway, they began to suspect that the months — and sometimes years — they spent sacrificing for their careers had been some kind of trick.

Wage and hour lawsuits were filed by former unpaid interns at Fox Searchlight Pictures and Harper’s Bazaar, owned by Hearst Magazines. The Fox Searchlight case has just been decided and, for perhaps the first time, a federal judge has ruled that the internships at Fox Searchlight violated both New York wage and hour law and the federal Fair Labor Standards Act. Furthermore, the judge authorized a class action lawsuit against Fox Searchlight.

Two production interns who had interned at Fox Searchlight during the making of the critically-acclaimed blockbuster “Black Swan.” While interns, they had performed many job duties that otherwise would have been handled by paid employees. Even more important in the case of unpaid internships, their work was primarily done for the benefit of the employer.

Legally, unpaid internships cannot be used to exploit ambitious or desperate young workers. The only reason this type of work is allowed to go unpaid, the Department of Labor says, is because it is meant to provide an educational experience intended primarily to benefit the intern.

According to the Department of Labor, unpaid internships are legal only if they generally meet the following six requirements:

  • Internships must be similar to training provided in educational environments, even when they include business operations work.
  • The internship is primarily for the benefit of the intern.
  • The employer derives no immediate advantage from the internship, and companies who choose to offer internships must understand that they could occasionally impede the employer’s business.
  • Interns are not being used to displace other employees, but interns must instead work under close supervision by paid staff.
  • The internship cannot be a trial period before hiring; interns must understand they are not necessarily entitled to a job at the internship’s conclusion.
  • Both the employer and the intern must understand that no wages are to be paid.

In light of the Fox Searchlight ruling, we can expect the Department of Labor to scrutinize unpaid internships carefully. If you believe you may be employed at an unlawful unpaid internship, you should raise your concerns with your employer. If you aren’t sure what to do, it’s a good idea to talk to an employment law attorney.

Source: The Atlantic, “The Court Ruling That Could End Unpaid Internships for Good,” Jordan Weissmann, June 12, 2013