Why You Should Stop Using Unpaid Interns
By Robyn Porter, Human Resources Manager & Consultant, HTG Peer Groups
Interns have been used in many companies across almost all industries for dozens, if not hundreds of years. Many SMBs find the use of interns invaluable, as they can ease the burden of operations from both a staffing and financial perspective. Additionally, many interns gain valuable skills and connections as a result of their exposure to their chosen profession, and these are the “perks” many employers hang their hats on.
However, the operative word here is USE. Many interns have been used in ways which are now being recognized as not only unethical but also illegal, and many states and the Department of Labor are taking steps to stop the use and abuse of unpaid interns. Not only does the misuse of interns become legally and financially problematic, it also fosters an unwanted culture within your organization of devaluing or undervaluing their contributions to your team. (And how does that translate to the rest of your team?)
As with most employee/employer relationships, there’s a law for that. The Federal Department of Labor, Wage and Hour Division, has a fairly concise test which needs to be applied for unpaid interns:
- 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;
- The internship experience is for the benefit of the intern;
- The intern does not displace regular employees, but works under close supervision of existing staff;
- 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;
- 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.
I would also add here that the intern be a part of an accredited college or university and be receiving college credits as a result of their work experiences. Bottom line here? If your intern benefits your operation in any way you must pay them. In fact, they really need to be a burden on your operation in order for you to classify them as unpaid.
A considerable amount of time has been spent recently in both state and local courts focusing on interpretation of these guidelines, and most of the cases are not coming down in favor of the employer. In fact, these cases are such a legal mine field right now that there are websites devoted to helping interns sue employers!
From a legal perspective, it simply isn’t worth using unpaid interns. Several recent court cases have garnered national attention, and even industries that have historically used unpaid interns are paying hefty fines and changing their business models as a result. While these may be high profile multimillion dollar cases, SMBs are not exempt from scrutiny. Many state jurisdictions are looking to enforce local laws as well, and all it takes is one disgruntled intern to start the ball rolling.
Robyn Porter is a Human Resources Manager of 20+ years and Consultant with HTG Peer Groups. Her background includes the IT, Hospitality, Distribution, Entertainment and Gaming industries, and from operations to ownership to corporate human resources. Her passion lies in the SMB space helping businesses to maximize HR processes and successfully navigate the challenges. You can reach her at rporter@htgpeergroups.com or find her on LinkedIn or Twitter at @RobynTheHRLady.
About HTG Peer Groups. HTG Peer Groups is an international organization of leading IT solution providers with nearly 300 member companies. In everything they do, whether running peer groups, coaching, or consulting with clients, the HTG team looks to make a positive difference in the lives and businesses of those they serve. Visit www.htgpeergroups.com or call 712-794-7994 for more information.