Q.  Are unpaid internships appropriate?
A.  Under federal law, for-profit employers must pay workers unless the position meets six criteria, including one stating that the employer “derives no immediate advantage from the activities of the trainees or students.”

All of the following criteria must be met in order for an internship to be unpaid according to the US Department of Labor:

  1. The training, even though it includes actual operation of the facilities of the employer, is similar to that which would be given in a vocational school;
  2. The training is for the benefit of the trainee;
  3. The trainees do not displace regular employees, but work under close observation;
  4. The employer that provides the training derives no immediate advantage from the activities of the trainees and on occasion the employer’s operations may actually be impeded;
  5. The trainees are not necessarily entitled to a job at the completion of the training period; and
  6. The employer and the trainee understand that the trainees are not entitled to wages for the time spent in training.

Caution: Some employers assume that if a student earns academic credit for an internship, the employer does not have to comply with federal laws.  That alone, however, does not guarantee that the employer is in compliance with the six criteria of the Fair Labor Standards Act, according to the US Department of Labor.

http://www.sonoma.edu/sbe/careers-and-internships/internship-pay-faqs.html

 
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