Summer Internships – New Pay Guidelines

Its April, and although the weather hasn’t cooperated much – its Spring! For returning college students, this time is both a happy and stressful time. Happy since classes are almost over, stressful in that they need to secure some type of employment for the summer. Add the additional stress of securing a college internship as the paramount choice since internships will provide college credits, and often can lead to employment opportunities.

From an employer’s perspective, college interns can provide a valuable resource and assist with meeting important future staffing needs. Having said that, employers need to be reminded of the do’s and don’ts of summer internships. Most important on the do’s and don’ts list is properly paying summer interns. We still find that many organizations are not sure if they are required to pay summer interns or not.

The Department of Labor (DOL) recently updated guidance resulting from recent court rulings in January. A main question is who benefits most from the internship relationship – the employer or the intern. The DOL developed and applies a “primary beneficiary test” to determine this:

  1. The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa.
  2. The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.
  3. The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.
  4. The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar.
  5. The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.
  6. The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.
  7. The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.

So, what is an employer to do?

Here Are My Quick Summer Internship Best Practices

  • Create a formal internship program with scheduled start and end dates
  • Maintain records of hours worked
  • Emphasize and put into practice the training and supervisory characteristics of the program
  • Ensure that the internship isn’t being used as a substitute for regular, paid employees or as a trial period
  • Provide a written offer letter to the student intern, stating that the internship is unpaid and that a job is not guaranteed
  • If an intern is not enrolled in a college, junior college, community college or university, they will not meet the educational requirements
  • When publicizing the internship, state that applicants who will receive college credit are preferred
  • Best advice – pay interns minimum wage!

Summer internships are wonderful for both employers and interns. Ensuring the internship meets all wage and hour regulations is critical in ensuring success for both the intern and the employer.

Happy Spring!

By |2018-04-30T13:35:53+00:00April 9th, 2018|Small Bites|1 Comment
Nick Daukas

With 25+ years of HR experience Nick specializes in ER, OD, Recruitment and Legal Compliance. He has an MBA and holds advanced HR certifications SPHR, SHRM-SCP.

One Comment

  1. Cheryl Chester 2017-07-03 at 1:20 pm - Reply

    Great tips, Nick!

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