Summer has FINALLY arrived (at least unofficially), and with it comes the traditional right of passage for many college students: the summer internship. Internships can be a great opportunity for both the students AND the companies utilizing their services. Of course, the intern can pick up some great experience.  Meanwhile, the company benefits from some additional help at an affordable price.

But what happens when “affordable” actually is free? Unpaid internships are common, but they are increasingly coming under fire by the Department of Labor (DOL). Are your clients utilizing unpaid interns? If so, you may want to turn their attention to the six criteria of legal unpaid internships established under the Fair Labor Standards Act (FLSA) as stated on the DOL’s fact sheet on Internships:

  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 /internship 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.
  6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

The DOL has been paying more attention to illegal unpaid internships in recent years. Not only that, interns who believe their unpaid status to be illegal are proactively filing class action lawsuits. You may have heard about the ongoing lawsuit between former interns for the film “Black Swan” an..., but companies and cases don't have to be so high profile to be burned by these lawsuits, which can result in companies having to pay back wages, damages, and fines. In fact, statistics show that nearly half of all interns are unpaid.  That means there is a good chance your clients are utilizing unpaid interns, quite possibly illegally. 

You may want to give your clients a heads up regarding the potential pitfalls of unpaid internships. They may want to reevaluate their programs to make sure they are being implemented in accordance with the FLSA. But that doesn't mean they have to abandon their internship programs, which can be a great way to identify and groom potential talent. Nor do they have to hire interns as traditional employees, taking on all the risk, liability, administration, and additional costs that come with employees.  As a recruiter, you can offer to convert their interns to contractors who will become W-2 employees of a contract staffing back-office, which will handle all of the employment responsibility and liability. Plus, this can provide a great source of additional summer income for you as a recruiter.

Debbie Fledderjohann is the President of Top Echelon Contracting, Inc.

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