There's no justifiable reason for why companies shouldn't have to pay their interns.
Pursuant to the United States' Fair Labor Standards Act (FLSA), an internship can be unpaid if it meets very specific requirements, the most important one being that "the intern's work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern." If the wording there seems a bit murky, that's perhaps intentional, considering the amount of companies who benefit from unpaid student labor each semester. The law was actually rewritten earlier this year following a string of class action lawsuits that were leveled against Fox for not paying its interns. The new law considers the seven parameters outlined in the FLSA, described as a "primary beneficiary test," as flexible, with no single factor being determinative. Unlike in years past, no threshold related to these rules has to be met. The law is now far more subjective and overwhelmingly benefits companies who wish to hire interns without paying them.
Before this, it was illegal for an employer to force an unpaid intern to go on a coffee run for the office, as this is neither educational, nor beneficial to the intern. An intern's work also couldn't benefit the company monetarily. So, if for example, Martha in accounting got behind on her work, contrary to popular belief, she wasn't allowed to ask an unpaid intern to fill out some spreadsheets for her, as this constitutes work that directly benefits the company. The law is now written in vague terms such as "complements" and "displaces" and tends to obfuscate this point. With these changes to FLSA, the Department of Labor has taken clear stance and has sided with the employers, not the interns (workers).
In a January interview with Bloomberg, Paul DeCamp, an attorney who works with employers regarding interns and labor disputes, said this about the original law: "If the intern did any productive work for the company it would -- at least based on the strict reading of the test -- be required that activity be paid, which is not to put too fine a point on it, ridiculous."
DeCamp didn't specify why the premise of paying someone for "productive work" is "ridiculous," but it's safe to assume his point of view is shared with the people writing him checks. Don't worry though, he also assured his interviewer that "if the intern is primarily doing grunt work, not learning skills, not learning about the industry, but is simply replacing work that would've been done by paid employees and therefore amounting to nothing other than free labor and with no discernible benefit to the intern, I think courts would still be willing to say that is employment." Here's the thing though, companies can always find a "discernible" benefit. In one lawsuit filed by interns at Hearst, judges ruled in favor of Hearst, despite the interns complaints about doing menial work while receiving no training. The reason for the ruling? The interns wanted careers in fashion and entertainment, and menial work constitutes "real-life experience" in their fields.
These are just the companies getting taken to court. The rampant abuse of the internship system is nothing short of systemic. In an article in Forbes, Susan Adams discusses an ad she found for the shoe company Salvatore Ferragamo. The ad was for an unpaid "retail internship" that included walking the floor and assisting customers inside of a Salvatore Ferragamo store in New York City. It's important to note that this article was from 2014, well before the labor department decided to make its rules a bit more lax. This is the kind of abuse that was possible.
The fact of the matter is, the latest adjustments to the FLSA, makes the already largely unenforceable laws surrounding unpaid internships, completely moot. There's no federal regulation in place to stop companies from abusing their interns and using them for free labor. The only recourse before was for an intern to sue his/her respective company, and now that that's off the table, those who would work unpaid internships have no real ability to fight for their rights as workers. This isn't just a labor rights issue, however.
When it comes to unpaid internships, the list of negatives is a mile long. These programs overwhelmingly benefit people who can afford to work for free. The rest of us are not so lucky, and the result is a class of applicants that is made entirely of young, upper-class college students or graduates that is neither representative of the American labor force nor fair to the many qualified people who can't get into the industry of their choosing. This is not a simple matter of millennials complaining about their job prospects. Unpaid internships create a huge barrier to entry that fosters and feeds wealth inequality around the country. Without these internships, it's harder to get entry level jobs, and by extension harder to advance in your career. Regardless of the "educational benefits," some aspect of interns' work will always help the company, and that work needs to be classified as labor. If a business isn't prepared to hire their intern at the end of the program, then why take the time to train the intern? The intern's work will always benefit their employer in some way.
Unfortunately, companies are always going to bend the rules and try to convince unassuming kids to work for less than they're worth, but if we have a system in place that helps protect that kind of skulduggery, rather than the workers themselves, are we not equally culpable for the societal damage it causes? Plenty of HR departments have determined that paying interns the minimum wage isn't worth the overhead, and it's important to understand they aren't particularly concerned with the difference between learning and labor. A company not paying someone for their work is a cost saving measure. Nothing more. There should be no such thing as unpaid labor in this country. Pay your interns.
What does an intern provide to a company and should they be paid for their work?
If you've ever searched for an internship, you know how rare it is to find one that's paid. Usually, the associated advertisements focus on how potential interns will benefit by working as part of the team at a top company, learning skills they'll use for the rest of their lives and networking with notable people.
However, some question the legitimacy of the gains from unpaid internships. Are students getting enough out of their internships if their bosses just choose to use them as secretaries and coffee runners? And how do unpaid internships contribute to income inequality? Let's examine a few aspects to keep in mind when considering whether or not interns should be paid.
Unpaid internships tolerated in ultra-competitive industries
A person who is trying to get his or her foot in the door and break into the entertainment industry or another extremely competitive field may reason that unpaid internships are not only common but also expected. That individual might think, "If I can just learn how things work at X Company, I'll have something great to put on my resume, and I might even get a job out of the experience. Considering those advantages, I'll figure out a way to get by without pay."
There's also the problematic reality that if a potential intern is unwilling to work for no pay, he or she can feel certain that dozens or even hundreds of other hopefuls would surely work hard without getting paid. Then, there's the assumption that if a person doesn't seize the chance to grab an unpaid internship, he or she might be completely out of luck since internships are so scarce and people are always willing to work for free.
Legal specifications to keep in mind
The stereotypical intern is someone dashing around from dawn until dusk, eagerly making copies and filling empty coffee cups for superiors. Although that dedicated individual might be making a strong impression regarding personal work ethic, those types of activities don't transfer to become future job skills. Some companies have taken bold stances and chosen to pay their interns, recognizing that they are assets to the team.
However, there have been instances where interns fulfilled duties that ended up being integral to a project's success, and they didn't receive a dime for their efforts. Many people do not realize that unpaid internships can result in lawsuits related to the Fair Labor Standards Act. There were two prolific cases associated with interns at Gawker and Fox Searchlight Pictures. Both argued because their duties were so integral to operations, they deserved payment.
According to legal rulings, unpaid internships have to occur in a primarily educational environment that benefits the intern. Also, the employer cannot take advantage of an intern and make that person do things that would necessitate a paid staff member receiving income for the work.
Unpaid internships highlight income inequality
People have also argued strongly that unpaid internships are luxuries for the economically fortunate. That line of thought makes sense, especially considering that many internships occur during the summer. That's a time when people who are not financially stable can't even consider applying for internships because they have to use that coursework-free season to make money that'll sustain them through upcoming semesters.
It raises the question of whether employers might be unintentionally preventing ideal candidates from applying for an internship because an unpaid option isn't financially realistic. Employers who offer paid internships bring a welcome element of equal opportunity to the internship candidate pool.
What must happen to help interns who take unpaid internships?
Indeed, paying interns or making them work for free is a decision that's up to employers. If they choose the latter, they must break the stereotype and reward worthy interns by letting them do things that'll genuinely benefit them in their future careers.
Of course, it would be feasible to assign interesting activities based on a person's prior performance. If someone characteristically shows up late and displays an obviously bored attitude while interning at a company, he or she would arguably not be a prime candidate for exciting and demanding responsibilities. On the other hand, when an intern manages time well, is inquisitive and otherwise meets or exceeds expectations, then the stage is set for bigger and greater things.
Also, employers need to consider that payment could be an incentive that helps them find the best, most highly motivated interns. If that happens, they might reduce hiring costs down the line because they can bring proven interns on board instead of having to dive blindly into the job market.
Hopefully, the influx of legal cases taken against companies that didn't pay interns for doing valuable work might inspire a change. Until then, it's up to interns to be assertive if they're continually only given menial duties during an internship. As long as they're performing well at a level that is at least as good as their peers, they can build a strong case that if payment is out of the question, they need to get educational ways to spend their time.