THE PERILS PRESENTED BY INTERNS

HOW TO PROTECT YOUR KINDLY INTENTIONS

By Laura Fowler and Susan Littleton

Do any of the following statements describe you?

  1. I own a small professional firm. I receive many requests from students about to graduate who say they simply want to learn more about what I do. They assure me they don’t want any pay. They just want to watch me go through my professional paces for a few weeks or the summer, shadowing or as an unpaid intern.

 

  1. My wonderful friends and parents are concerned their child has lost their way. They beg me to allow them to intern at my firm, assuring me they do not expect them to be compensated in any way. Some even offer to pay me.

 

  1. I have a hard time saying “No” to requests to help others who seem so genuinely to want and need training in something I actually know how to do. My heart goes out to individuals   who seem so eager to learn, so sincere in their expression of interest about my professional or vocational path, and so terrified about their employment future with student loans looming large on their horizon. Some requests come from older students who are starting a second career and feel they are at an extreme disadvantage in hiring.

 

Friends and fellow employers, please take a deep breath and count to ten (10)! Your kindly intentions may lead down a dangerous path if you do not take a few precautionary steps.  The following is the current law about uncompensated workers, largely ignored by all until an unhappy unpaid shadower or uncompensated intern files a complaint with Texas Workforce Commission, US Department of Labor, City of Austin Human Rights Commission, or everybody’s favorite: US Equal Opportunity Commission.

“Why?” you say. And the answer is: “Because they have every right to do so under current local, state and federal law”.

For many years, federal law and companion state and local mandates have prohibited employers regardless of the number of employees from allowing individuals to perform tasks uncompensated which displace an opportunity for a compensated worker.  Some employers are well situated to create true pure internships in which there is a campus or classroom setting purely for education, of a sort a traditional compensated worker would not normally receive, accompanied by a beneficial (to the intern) opportunity to observe the workplace and follow others around observing the tasks or duties of traditional workers without displacing a traditional worker.  Of course, this truly limits what the intern can learn but any other path, the mixing of traditional compensated duties and observation places the employer at great risk. And this is not an inexpensive program to operate when staffing and programing costs are considered. Oh yes, and how do you document that you didn’t displace a worker?

Here are a few helpful links to US Labor Department regulation, and a few exhilarating lawsuits brought by summer interns in what most would consider a dream internship, as a movie studio intern at Fox Search Light Movie studios.  And yes…. the uncompensated interns won and so did those who claimed that while paid, they worked so many hours they were owed but deprived of overtime wages.

In the event of a dispute between an intern or shadower alleging they are were unlawfully underpaid or uncompensated, the following six criteria will be applied when making this determination:

  1. 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;
  2. The internship experience is for the benefit of the intern;
  3. The intern does not displace regular employees, but works under close supervision of existing staff;
  4. 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;
  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

If all of the factors listed above are met, an employment relationship does not exist under the FLSA, and the Act’s minimum wage and overtime provisions do not apply to the intern.  This exclusion from the definition of employment is necessarily quite narrow because the FLSA’s definition of “employ” is very broad.  Some of the most commonly discussed factors for “for-profit” private sector internship programs are considered below (emphasis added)

See: https://www.dol.gov/whd/regs/compliance/whdfs71.htm; http://fortune.com/2015/01/29/unpaid-internships-legal-battle/; https://jezebel.com/marc-jacobs-settles-class-action-intern-lawsuit-out-of-1793562609

OK, so we still haven’t dissuaded you from reaching out to those who beg you for an opportunity? Here are two suggestions for more defensible ways to inspire others and provide valuable training in their declared area of interest without inviting a lawsuit.

(a) Treat the intern as part time, short term employee and in writing provide to:

1. pay only minimum wage*;  *make sure you don’t receive any grants or fall under any other contract requirements to pay a prevailing wage

2. limit the number of hours each week so the intern does not go into overtime;

3. clearly define the beginning and end of the term of the internship; and

4. make it very clear no guarantee of further employment or positive recommendation to potential employers exists.

At the end of the relationship, if the intern was the greatest human being you ever met, by all means hire them or recommend them to others. But until then, stick to your contractual assurances.

Does this sound harsh? Well what if they turn out to be the worst intern you ever had?  Are you going to pass them off to all your other friends? What if your budget just won’t let you hire anyone else right now? Just because there is work for the intern, doesn’t mean you can afford another full or even part time employee. Telling the intern that you can’t afford them at  the end of a period in which they began with misguided hope that they would receive an opportunity, is an absolutely guarantee that sooner or later one of them will file a complaint with one of the federal, state or local governments listed above. That was one of the underlying reason for the suits by the Fox Searchlight interns, that and a weak economy in a highly competitive industry of entertainment.

As an alternative to all this, we suggest you associate with a well-established program that sponsors interns whose relationships will be solely with the program sponsors. Universities may offer these; professional associations and foundations may offer these. The lucky intern in such programs typically receives a wide array of experiences related to their declared area of professional interest and you will be just one of several venues where the intern gains knowledge and valuable skills.

In your every internship and shadowing adventure, we wish you the very best.

*The Fowler Law Firm PC: Attorneys with The Fowler Law Firm PC are proud supporters of and contributors to Austin Bar Association Diversity Fellowship Program.

See: http://www.austinbar.org/for-attorneys/committees/diversity-committee/

We eagerly await the arrival of our 2018 law intern.  This fortunate intern will endure the endless sermons and proclamations of a whole team of The Fowler Law Firm PC Happy Lawyers extolling the glories of law practice, the heroic traditions of law practice, the exciting future of law practice.  What a deal!

See: https://thefowlerlawfirm.com/giving-back/

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