6 factors that determine if an unpaid internship is legal

Business, Consumer protection, Crime, Money, Rights

If you’re an unpaid intern at a for-profit company, your internship must meet six out of six regulations outlined by the Department of Labor. If your company fails to meet even one, you may qualify for employee status under the Fair Labor Standards Act (FLSA), and be entitled to all the benefits and protections it offers — including wages.

Note that internships at nonprofits and government agencies are not subject to the same regulations. But if you’re an intern at a for-profit company, the following is a breakdown of the Department of Labor’s six guidelines and what they mean for you.

1. “The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment.”

This requirement doesn’t mean unpaid internships have to provide college credit, but it does mean that companies cannot simply claim standard employee training as “education.” Companies must make an effort to provide you with some useful skills — otherwise they have to pay you.

2. “The internship experience is for the benefit of the intern.”

Even if you are learning some skills as a result of an unpaid internship, you must be the one seeing the most benefit from your internship — not your employer. Companies cannot benefit from your work without either providing you a greater benefit or compensating you for your time.

3. “The intern does not displace regular employees, but works under close supervision of existing staff.”

Companies cannot legally use you as a source of free labor. If you are acting as a substitute for regular or seasonal employees, you must be paid for your time. That’s not to say that a company can’t offer you a job shadow position, but these positions must be educational in nature and have a higher degree of supervision than a normal employee would receive.

4. “The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded.”

Regular employees receive payment to compensate them for the value they provide to a company. If you are providing immediate benefits to a company as part of your internship, then you are likewise entitled to compensation for your work.

5. “The intern is not necessarily entitled to a job at the conclusion of the internship.”

Unpaid internships aren’t meant to carry a guarantee of employment at your company. If your unpaid internship is essentially a trial period, then you’re considered a trial employee rather than an intern, which means you need to be paid. That doesn’t mean that a company can’t offer you a job at the end of your internship — that’s perfectly legal. What isn’t legal is promising you a job at the start of your internship.

6. “The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.”

In the case of unpaid internships, companies need to inform you that your position is unpaid before the position actually begins. Likewise, you also need to inform them that you understand you will not be paid for your internship. The generally accepted method of accomplishing this is a written agreement between you and the company.

This article originally appeared with Avvo’s Is Your Internship Legal? quiz. Take the quiz now to find out if your internship is legal.

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