Don’t Get Sued By Your Intern


Ignore the idea that interns are free labor.


The Department of Labor Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting employees in the private sector and in federal, state, and local governments.  If each of the following six criteria listed below are met, an employment relationship does not exist under the FLSA, and the Act’s minimum wage and overtime provisions do not apply. Unpaid internships in for profit businesses are only legal when:


  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;
  2. The internship experience is for the benefit of the intern;
  3. The intern does not displace regular employees, but works under close supervision of existing staff;
  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;
  5. The intern is not necessarily entitled to a job at the conclusion of the internship; and
  6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.


Don’t break the law.


Unpaid internships should be designed as a learning environment. Teaching and training the intern in professional skills must be the primary goal of an unpaid internship in the private sector. Not paying interns for substantive work or efforts resulting in financial gain in for profit companies makes your business vulnerable to lawsuits. Every intern who is performing “real” work must be compensated financially.


Despite the legal demands of internships, hosting interns is a great way to grow your business while building a strong workforce.


Three benefits of starting an internship program:

  1. Develop a pool of talented candidates for open positions
  2. Increase your organization’s productivity
  3. Interns can provide “low cost” labor because their compensation will be less than full-time employees


Contact me to discuss additional benefits of working with interns, potential challenges of working with interns, where to find the best interns, and how to provide a mutually beneficial learning experience.


Article originally posted on LinkedIn.










Nicki Sanders, The Packaged For Success Coach, is an Adjunct Professor with a passion for business and career development. She has an extensive background in developing and managing interns and successful internship programs. She is a skilled manager, coach, trainer, and group facilitator who has packaged her Master of Social Work degree and 20 years of work experience into Packaged For Success, a full service training and professional development company.

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