This summer, SkEye Studios will be starting an internship program. As we look forward to bringing in students to mentor–and let’s be honest, teach us–we’ve been researching the legalities of all that we’re hoping to do. I came across this blog by another production company. It helps break down the legalities of offering unpaid internships. Granted, at SkEye Studios, we want to work with our interns’ colleges or universities to ensure that they’ll be able to receive some form of academic credit for all the learning and experience they’ll gain!
Peter Mavrick, attorney for management and employers, was recently asked to render advice to a client in the film and video industry regarding its unpaid internships. A film and video business can teach valuable career lessons to novice career entrants. However, the structure of the unpaid internship opportunity matters from a legal perspective. As explained in further detail below, the most conservative approach is to link the internship to a bona fide school program for credit. Even in the absence of a school program, wages do not necessarily need to be paid to the intern. The main problem with internships, however, is that they expose the business to potential meritless claims where current or former interns contend they were exploited and deserve wages. In addition, the structure of the unpaid internship can fall within a gray area where the facts can lend themselves to different interpretations, with one possible interpretation supporting a valid claim for unpaid wages. In this article, attorney Peter Mavrick discusses, from a management attorney’s perspective, the law surrounding unpaid internships and federal wage law requirements.
The Fair Labor Standards Act (FLSA) requires that “employees” be paid a minimum wage and overtime wage for hours worked in excess of 40 hours per week. The FLSA’s definition of “employee” is quite broad and could include workers whom the employer classified as “volunteers” or “unpaid interns.” Whether an individual in an “employee” under the FLSA does not depend on labels, titles, or agreements between the employer and the individual. Consequently, employers sometimes are surprised to learn that an individual who agreed to work as an unpaid intern might have a viable claim for unpaid wages under the FLSA. Generally, courts will find that an unpaid intern is not an “employee” if the following six factors are satisfied: (1) the internship is similar to that which would be given in a vocational school; (2) the internship experience is for the benefit of the intern; (3) the intern does not displace regular employees, but works under close supervision; (4) the employer providing the training derives no immediate advantage from the intern’s activities and on occasion the employer’s operations may 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. No one factor is dispositive, nor are the factors applied mechanically. Instead, courts generally use those six factors to guide their analysis. Recently, a federal court in Florida applied the above six factors and held that certain student interns were not “employees” under the FLSA. In Schumann v. Collier Anesthesia, P.A., 2014 U.S. Dist. LEXIS 71152 (M.D. Fla. May 23, 2014), student registered nurse anesthetists (“student interns”) participated in an internship program supervised by an employer. The internship was a requirement for graduation, and the student interns understood they would not be paid. Nonetheless, 25 student interns sued the employer for unpaid wages for work performed during the internship.
This blog is from NYC video production company, Indigo Productions. To learn how the six factors can swing (toward the employer or toward the student), see the full blog here.