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Are Unpaid Internships Legal?

Boss handing her employee a salary check

The job market is highly competitive, and prospective employees are looking for any edge they can get when it comes to getting hired for a great job at a great company. While having the right education and skills can help, many people are taking it a step further and applying for unpaid internships.

As the name implies, unpaid internships are job opportunities where the applicants work for free. In exchange, they learn the workings of a company and gain valuable skills and experience. There are 1.5 million internships available in the United States every year. Half of these are unpaid.

While nobody really likes the idea of working without pay, many find it to be a great opportunity.

However, there is some controversy over unpaid internships. After all, it appears as though in many cases, the company is getting free labor. Instead of hiring new employees and paying them, they can delegate tasks to the intern.

However, this is not fair to the intern. Under federal law, every employee is entitled to minimum wage and the benefits that come with unemployment, such as workers’ compensation insurance and unemployment benefits. This means there can be a fine line between internship and employment, based on the duties performed.

A company cannot take advantage of an unpaid internship. In fact, unpaid internships can actually be illegal if they do not meet certain requirements.

Requirements of Unpaid Internships

In order for an unpaid internship to be deemed legal, it must meet all six of the following requirements:

  • The internship must be similar to the training offered in an educational environment.
  • The internship was created to benefit the intern—not the employer.
  • The intern is not used in place of regular employees. Instead, the intern is supervised by other employees.
  • The employer does not benefit from the intern’s activities.
  • The intern is not promised employment once the internship ends.
  • Both the intern and employer understand that the internship is unpaid and includes no payment of wages.

Given the requirements listed above, it is difficult for a company to offer a legitimate unpaid internship. An unpaid internship is supposed to act like a schooling of sorts, and that is hardly ever the case. Unpaid interns are not supposed to be given real tasks to work on and they are not supposed to be engaging in any activity that could benefit the employer, and that rarely happens. It is important for prospective interns to become familiar with the Fair Labor Standards Act (FLSA).

Contact a New York Employment Contract Attorney

 Many employers like the idea of hiring someone to work for them for free, but there are certain guidelines that have to be met. If an employer is not following the requirements, then they can face legal issues.

An internship should benefit the intern—not the company. If you feel like your company is taking advantage of free labor, the internship may be illegal. You could be entitled to compensation for work performed. Seek help from the experienced New York employment law attorneys at Ricotta & Marks, P.C. They can help you understand your legal rights. Contact us to schedule a consultation at (800) 240-9269.

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