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Wage Payment for Interns

Interns in a for-profit organization may qualify as an employee, and not a trainee, under the Fair Labor Standards Act (“FLSA”) and therefore are entitled to the payment of minimum wage and overtime.  Under the FLSA, 29 USC 201 et seq., except for those who qualify for the exemptions set forth therein, all employees must be paid at least minimum wage for all hours worked, plus overtime for all hours worked over 40 per week. 

The Supreme Court in Walling v. Portland Terminal Co., 330 U.S. 148 (1947) set forth a six factor test to be used to determine if an intern is merely a trainee, who is working to benefit oneself, which would allow the internship to be unpaid or if the intern is actually an employee who must be paid a wage.  Those six factors are:

1.            The training provided to the intern by the employer is similar to that which would be provided in a vocational school.   The more classroom like the structure of the work performed is, the more likely the individual will be considered an intern and not employee.

2.            The training actually benefits the intern.

3.            Regular employees are not replaced by the intern and the intern shadows employees and works under close supervision. 

4.            The employer derives no immediate advantage from the activities of the intern and its operation may sometimes actually be impeded by training the intern. 

5.            The interns are not entitled to become employed by the employer upon completion of the training period.

6.            Both the employer and the intern understand that the intern is not entitled to payment for all time spent training by the employer. 

This test has been consistently applied by the Department of Labor to determine whether an intern is an employee and therefore, entitled to payment of wages for time spent training.   If the criteria above are met, the students will not be considered employees of the company to which they are assigned.

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