When It Comes to Interns: To Pay or Not to Pay, That is the Question
So you want to hire an intern. That’s great—the benefits for both employer and intern can be many and outweigh any potential risks. Whether hiring an intern, or having an intern program, is economically viable for your business often depends on whether the interns must be paid. Both are options, but under both federal and New Jersey State law, an internship program must meet certain criteria in order for an employer to be exempt from paying its interns.
Federal Law Under the Fair Labor Standards Act
Under the FLSA, the federal law which governs the payment of wages, the key determining factor is the nature of the work relationship. A work relationship is most likely to be recognized as an internship if it is primarily for the benefit of the intern and not the business, and provides training which is similar to that which would be provided in an educational environment. An intern must work under the close supervision of workplace staff. Although under federal law, it is not a separate requirement that the intern be enrolled in an educational institution, if he or she is so enrolled, the more oversight provided by the educational institution supervising the internship program, the more likely the work situation will be viewed as an internship. It is also more likely that the intern will be viewed as receiving educational training—and therefore need not be paid—if the work relationship provides the intern with skills that can be used in multiple settings, as opposed to skills particular to one employer’s operation.
The mere fact that the employer may be receiving some benefits from an intern does not disqualify the internship from being unpaid. However, an intern cannot be crucial to a business, cannot displace regular employees and must not necessarily be entitled to a job at the conclusion of the internship.
Additional Requirements Under State Law
New Jersey has similar requirements to those contained in the FSLA , but in New Jersey, in order to qualify as an unpaid intern, an individual must be enrolled in a “school-to-work program.” A proper school-to-work program meets the following criteria:
- The student must be at least sixteen years of age;
- The internship must be related to a formal school-to-work transition plan for a student learner;
- There must be collaboration and planning between worksite staff and school staff resulting in clearly identified learning objectives related to the internship;
- Any productive work must be incidental to achieving learning objectives;
- The student learner must receive credit for time spent at the worksite and the student is expected to achieve the learning objectives;
- The student learner must be supervised by a school official and a workplace monitor;
- The non-paid activity must be of a limited duration, related to an educational purpose and there must be no guarantee or expectation that the activity will result in employment; and
- The student learner must not replace an employee.
For more information or questions regarding unpaid internships, please contact a member of the Employment Law team at Wilentz.
The postings on this blog were created for general informational purposes only and do not constitute legal advice or a solicitation to provide legal services. Although we attempt to ensure that the postings are complete, accurate, and current as of the time of publication, we assume no responsibility for their completeness, accuracy, or timeliness. The information in this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship. Readers should not act upon this information without seeking professional legal counsel.
This blog may contain links to independent third party websites and services, including social media. We provide these links for your convenience, and you access them at your own risk. We have no control over and do not monitor the content or policies (including privacy policies) of these third-party websites and have no responsibility for, and no liability with respect to, their content, accuracy, or reliability. Unless expressly stated, we do not endorse any of the linked websites or any product, service, or publication referenced herein or therein. We will remove a link to any site from this blog upon request of the linked entity.
We grant permission to readers to link to this blog so long as this blog is not misrepresented. This site is not sponsored or associated with any other site unless so identified.
If you wish for Wilentz, Goldman & Spitzer, P.A., to consider representing you, please obtain contact information from the Contact Us area of this blog or go to the firm’s website at www.wilentz.com. One of our lawyers will be happy to discuss the possibility of representation with you. However, the authors of Wilentz blogs are licensed only in New Jersey and/or New York and do not wish to represent anyone who viewed this site in a state where the site fails to comply with all laws and ethical rules of that state.