June 02, 2022

Biden White House Will Be First to Pay Interns

This fall, the current Administration will be the first ever to pay its White House interns.  Why? “Too often, unpaid federal internships have been a barrier to hardworking and talented students and professionals, preventing them from contributing their talents and skills to the country and holding them back from federal career advancement opportunities,” the White House said in a statement.

‘Tis the season.  Each Spring and Summer many employers consider engaging the services of workers without pay, such as volunteers and unpaid interns.  That is fine, so long as it is done correctly.  The U.S. Department of Labor has rules and factors it applies to determine whether a worker can be properly classified as an unpaid intern or volunteer.  For the latter, these factors vary for public and private sector. For the private sector, they also differ when applied to a for-profit and not-for-profit entity.

So, what is the risk?  One employer was recently sued by an unpaid intern who alleged she was an employee and should have been paid at least minimum wage and overtime. The employer presented a double-defense, citing that she was properly classified as an unpaid intern under a standard established by the U.S. Supreme Court and that she also qualified as a volunteer under the DOL’s test for public agencies. The court disagreed…in part. If found the intern was not a volunteer, but that she was properly classified as an unpaid intern. Whew, for the employer!

Lessons learned?  These analyses are very fact specific.  Before you engage a worker to be something other than an employee, check with your company’s HR department and/or employment counsel.  Also, see the related article in the newsletter, “DOL Announces Independent Contractor Rule on the Horizon.”

For more information, you can also check out the May webcast, “Are You May Employer? Defining Worker Status.” $25 pp. Still provides 1.25 HRCI and SHRM credits.