Debate: Interns Deserve Full Protection of the Law

(June 21) -- Internships give students the chance to preview employers and learn new skills, but in recent years, they have also become a prerequisite to a job for many college graduates entering the labor force. A National Association of Colleges and Employers survey of employers found that 76 percent of companies reported relevant work experience as the primary factor that influences their hiring decisions.

Now, during a recession, internships are even more important -- the unemployment rate for college graduates under 25 has averaged 9.1 percent over the past 12 months, up from 5.4 percent in 2007. For young, entry-level job seekers, experience as an intern can be the deciding factor in whether they are able to find a job.

Unfortunately, many employers are taking advantage of the students' vulnerability, and many unpaid interns are doing work for which they should be paid.

As the Department of Labor reminded employers in a Fact Sheet it released in April, under the Fair Labor Standards Act of 1938, a six-point test determines whether an intern qualifies as an employee and should therefore be paid.

Unpaid interns at for-profit businesses must not displace regular employees and cannot do work that provides immediate benefit to the employer. Basically, the primary purpose of an unpaid internship must be the education of the intern.

Companies are at serious risk of violating the act when their unpaid interns are filing, running errands and answering phones, let alone doing more substantive work. These are tasks that contribute immediately to the benefit of the employer and typically offer no relevant educational value for the intern.

Nancy J. Leppink, the acting director of the U.S. Department of Labor's Wage and Hour Division, recently told The New York Times, "If you're a for-profit employer or you want to pursue an internship with a for-profit employer, there aren't going to be many circumstances where you can have an internship and not be paid and still be in compliance with the law."

This six-point test was established by the Department of Labor on the heels of Walling v. Portland Terminal Co., a 1947 Supreme Court case that evaluated unpaid training for railroad workers. The world of a 21-year-old rising senior interning at Fox News is different than the world of a 21-year-old World War II veteran training for a career on the railroad, but the same law applies now that applied 60 years ago: Employers must pay at least the minimum wage to employees.

Renaming a job an "internship" doesn't negate that requirement -- otherwise, employers have an incentive to replace paid employees with unpaid interns.

In fact, most internships at for-profit companies don't pass this six-part test, and many, many unpaid internships are illegal. The Department of Labor generally relies on complaints from workers to initiate investigations, a system that benefits employers.

If you were a student who managed to get an internship in the field in which you wanted to work -- perhaps even at the company for which you hoped to find permanent employment -- would you speak up?

I give credit to the Wage and Hour Division for the guidance it released in April, but the Labor Department needs to do more to crack down on companies and firms that exploit students for free labor.

It is up to the federal government to protect the rights of the hundreds of thousands of students who do internships each year (though universities should also be held accountable for ensuring that they are giving credit to internship experiences that are genuinely educational and not exploitative -- even if it requires additional time and expense).

Young people in the U.S. are often criticized for failing to live up to their full potential. To my mind, however, unpaid interns around the country are hard at work making their way in a very difficult economic climate.

It is past time to provide these interns with the full protection of the law.

Ross Eisenbrey is vice president of the Economic Policy Institute.


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