Interns: to Pay, or Not to Pay?

Interns: to Pay, or Not to Pay?

Summer break is around the corner for many high school and college-age students. During this time, companies sometimes use interns to help with office tasks such as running errands and filing, in addition to assisting on larger projects. This can leave some companies wondering whether or not to actually pay the intern for their time, or chalk it up to unpaid professional experience.

Before you decide not to pay your intern, stop!

The requirements for interns to be classified as unpaid are more stringent than you may think. To consider a worker unpaid, all six of these conditions must be met, according to the Department of Labor (DOL):

  • The training is similar to that in a place of learning.
  • The experience is only for the intern's benefit.
  • The intern does not displace regular employees. 
  • The employer gets no benefit from the intern.
  • Interns are not entitled to a job at completion.
  • Both parties clearly understand that the training is unpaid.

The key factor is that an unpaid internship must be an educational experience that only benefits the intern. The company is not allowed to get any benefit from the unpaid internship. In fact, the company may find itself at least slightly inconvenienced or burdened by providing this unpaid educational opportunity.

Generally speaking, interns in medical, legal, and HR industries should be paid. There are some cases in which unpaid interns can be used, but we advise employers to proceed with an overabundance of caution.

If the intern will be doing any work that employees regularly do, the intern should be paid. If the intern is often running errands, making copies, working in the mail room, answering phones, or giving project assistance, the intern should be paid. If the intern is learning more about the industry, doing volunteer work of his or choosing, or produces a product that your company can't sell, then this particular intern just might be eligible to be unpaid.

For more information, review the DOL's guidelines . If in doubt or for assistance in setting fair pay standards at your company, contact your Human Resources Consultant at Nextep.

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