The days of employing unpaid interns may be coming to a close.
A federal district court judge in Manhattan recently ruled in favor of two unpaid interns who had sued Fox Searchlight Pictures for failing to pay them the minimum wage while they worked on the production of movies including “Black Swan.”
While some could argue making phone calls, ordering lunches and running errands may be valuable experiences for an intern, Judge William H. Pauley III ruled that the unpaid position ”” which is fairly typical of unpaid internships in today”™s economy ”” failed to meet the six-part test set for unpaid internships by the Fair Labor Standards Act.
The case could be appealed but legal experts say this is likely the beginning of the end for free labor. Less than a year ago, producers of “The Charlie Rose Show” on PBS paid out $125,000 to formerly unpaid interns as the result of a class-action lawsuit, and Hearst Corp. is in the midst of a similar legal fight, although in that case a judge ruled the plaintiffs did not constitute a class.
According to the U.S. Department of Labor, in order for an unpaid internship to be legal it must:
1. Give an intern similar training as an educational environment
2. Benefit the intern
3. Not displace any regular employees and involve close supervision of staff
4. Provide no immediate advantage for an employer and may on occasion impede operations
5. Not necessarily guarantee an intern will get a job at its conclusion; and
6. Operate under both the employer and intern”™s understanding that he or she is not entitled to wages for the time spent at the internship.
Robert G. Brody, a managing partner at Brody and Associates L.L.C. in Westport, told the Business Journal last month that he believed employers should no longer take the risk of employing unpaid interns unless they are very committed to the six-part test. Even with college credit, it”™s much safer to pay minimum wage, he cautioned.
“If an unpaid intern can somehow become paid, it takes away that huge risk that you”™re going to get sued,” Brody said. “Paying that 40 hours of minimum wage isn”™t a big deal for a lot of employers, for others it is though.”
In an informal survey by the Business Journal of several dozen readers, about two-thirds of participants said they believe unpaid internships should exist, though many qualified their answer, saying they should exist “within reason” or “only for nonprofits.” About two-thirds of respondents also said they currently work for or had worked for a company that has used unpaid interns.
“If they are getting college credit and exposure to important connections for future careers, then it usually is very beneficial to the intern,” one survey participant said. “However, companies are relying too heavily on this source of free labor, much to the detriment of other unemployed young adults who are having difficulty finding entry-level paying positions.”
Still another third of survey respondents said they didn”™t believe unpaid internships should be legal at all.
“It”™s unfair for companies to take advantage of students and young workers by asking them to commit extensive hours and hard work for nothing in return but ”˜the experience,”™” a respondent said.
“Employers are taking advantage of the fact that the job market is highly competitive,” said another participant who has held multiple unpaid positions. “In my first unpaid internship especially, there was very much a feeling of replace-ability. If I wasn”™t going to work for free, there was a line out the door of people who would.”
