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Unpaid Internships Are a Losing Deal for All But Employers

Unpaid Internships Are a Losing Deal for All But Employers

Unpaid internships exploit the labor of well-to-do young people, disadvantage their peers who cannot afford to work for free, replace paying entry-level jobs, and are often, but not always, illegal. Recently some of these interns have started to strike back by suing for backpay.

Last year, interns for the movie “Black Swan” sued for unpaid wages. On February 1st of this year, The New York Times reported that a former unpaid magazine intern sued Hearst Corporation for violating wage and hour laws. Both of these lawsuits alleged that the employers involved were required to pay for the particular internships at issue.

But sometimes it is legal not to pay interns. Under federal law (some states have additional requirements), unpaid internships are legal if they meet six criteria:

1. The training, even though it includes actual operation of the facilities of the employer, is similar to training available in a school;
2. The training is for the benefit of the intern;
3. The intern does not displace regular employees, but works under their close supervision;
4. The employer that provides the training 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; and
6. The employer and the intern understand that the intern is not entitled to wages.

In short, if an intern isn’t a bit of a burden, the employer must pay her or him. One sign that it is probably legal not to pay interns is when they receive college credit for their work.

But in many workplaces, employers are benefiting from unpaid interns’ work while everyone else involved suffers. In the “Black Swan” case, the plaintiffs claim that they did the same work as paid employees and did not receive training or advance their careers. Meanwhile they had to pay for their own room, board and expenses while Fox Searchlight Pictures exploited their free labor.

The interns weren’t the only ones who took a hit to their wallets. Uncompensated internships can contribute to unemployment. In the “Black Swan” situation, for instance, free interns did the same work as paid employees, and may have displaced people who used to do their work as a full-time job and are now unemployed.

Unpaid internships that do comply with the law harm another population: the many students and recent graduates who would benefit from the training and contacts internships can provide but who lack the resources to support themselves while working for free. Young people who already have the advantage of well-off families build on that head start with the training and foot-in-the-door that internships can provide. Once again the rich get richer, but instead of money, they accrue experience, valuable professional networks and sometimes even permanent jobs.

In February, Occupy Wall Street called on the New York Foundation for the Arts to stop advertising any and all unpaid internships. They may have the right idea. While people who worked in unpaid internships fight their former employers for back pay, this system raises a broader question: should unpaid internships be legal at all?

Related Stories:

Unpaid Internships: Valuable Experience or Unpaid Labor?

Are Unpaid Internships Hurting American Economic Mobility?

InternshipGate: Are Universities Letting Their Students Be Exploited?

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22 comments

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5:52PM PST on Nov 4, 2012

As someone currently trying to get a foot in the door, and having no luck whatsoever, I find it disgusting that people are lining up at every turn to exploit me. They want me to pay them for skills I already have (but need a 'qualification certificate'), me to work for free or very cheap labour "until I have proven myself to be a good employee". It's disgusting! This is certainly a US/Canada problem, because I would never have encountered this bullshit if I had stayed in Australia after I graduated.

5:20AM PDT on Apr 18, 2012

I had to take several unpaid internships while in law school. I was completely broke, and incurring more student debt -- but I learned more in the first few weeks of working for a judge than I had in my entire first year of law school. (This was a state judge in MA and they had already laid off staff b/c of a bad economy, so the internships were unpaid.) I realize now that I'm working how difficult it can be to take on an intern. They are often young people with no significant work experience, so you have to spend a lot of time training and supervising them. That's how they get paid.

I recognize that's a different situation from unskilled labor - if the intern is doing something that requires no or little training (say manual labor) and it's the same job that someone next to him or her is getting paid for, it's unfair.

My point is that you can't take the position that all unpaid internships are exploitation. Some are invaluable. If you start passing laws that they are illegal, all that will happen is that the good internships (where the intern learns a lot and make valuable contacts) will disappear with the bad ones in situations where an employer can't pay.

6:14AM PDT on Apr 16, 2012

If unpaid internships were illegal, then neither I nor the many students in my major (social work) would ever have gotten the chance to have real-life work experience in the field before we graduated. Most non-profits cannot afford to pay interns. Half of them can hardly afford to pay their own employees. I have a great internship. I have learned more about my field these past 3 months than I have in all 4 years of college. Now when I graduate and get my first job, I will be a hundred times more confident in my abilities. If agencies like the one I am at now are forced to pay interns, they will no longer be able to offer internships at all.

And just because I have an unpaid internship doesn't mean I don't also work so I can support myself. I have worked all through my college career. Most of the students in my major have paying jobs, take classes, and have internships all at the same time. It's tough, but college isn't supposed to be easy. Having an unpaid internship is not my concern right now. I'm more interested in having my student loans forgiven. Now THAT would be nice : )

8:07PM PDT on Apr 13, 2012

thanks

4:28PM PDT on Apr 13, 2012

I think if the case is that the student is receiving a sholarship or a free education then yes they should have to do unpaid internships. If students are paying their own way then no they should not be forced to do inteernships without pay. It must depend on the circumstances.

11:29AM PDT on Apr 13, 2012

I'm not sure how I feel about this article. I took my 3 boys and RAN from my ex to get away from the drugs. I lived on welfare for 3 years while I went back to school so I could support them with no child support. I had an unpaid internship in IT and it was very educational....real life cannot take the place of experience.

Thank you for your tax dollars! There are those out there that use them for what is intended...not a life choice.

11:17AM PDT on Apr 13, 2012

As a college student who can barely survive month by month with 2 or 3 paying part time jobs, I cannot understand how anyone can support themselves with an unpaid internship. Oh right, because those students are of my peerage who have never supported themselves, nor had a job, that's why they have to take an unpaid internship in the first place. I try to see it as fortunate that I grew up dirt poor and had to start working young, now that I'm about to graduate college I already have 7 years worth of job experience. I get job offers I don't court unpaid entry level slave internships which are basically an extension of school- just another way to keep an adolescent 'I'm not an adult yet' mindset so you don't feel responsible for your own life.

10:58AM PDT on Apr 13, 2012

Our non-profit has many unpaid interns. Training someone take time and frequently slows down the person doing the training. We also often get young people that have no previous job experience and are also teaching them what it means to HAVE a job. (no really you can't text while you are working, or play games on-line with your friends...etc etc) We have a pretty specialized field, if you are here, you really have to pay attention. All of our interns have either gone on to jobs in our field, or gone on for more schooling. I have also gotten some of the nicest THANK YOU notes, from their time spent with us.

10:03AM PDT on Apr 13, 2012

Internships are pretty much a crock of s#!t with thei promises of critical job experience and insider contacts. I did an unpaid internship back in the 90's and all I got was a stress fracture in my wrist and a lot more debt as I has to live off student loans. Don't buy the BS, especially if you're female. Internships = exploitation.

10:02AM PDT on Apr 13, 2012

I would think anyone entering the work place the first time would seek out college credit internships to gain experience for the resume. That being said, I would also think a smart person would not allow exploitation while being an intern. If it's not mutually beneficial, DO NOT DO IT!

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