Scholarship News

Labor Department Clarifies Rules of Unpaid Internships


April 23, 2010
by Scholarships.com Staff
Many fields of study require or strongly suggest semesters or summers of unpaid, or “educational,” internships, where students get experience in their intended future careers but not pay, and often not even college credit.

Many fields of study require or strongly suggest semesters or summers of unpaid, or “educational,” internships, where students get experience in their intended future careers but not pay, and often not even college credit.

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To address concerns that some employers may be taking advantage of the opportunity to have eager college students come work for them at no cost, the U.S. Department of Labor released a set of rules Wednesday that clarify the roles of those employers and the students’ colleges. The rules will fall under the Fair Labor Standards Act, which also establishes the minimum wage, overtime pay, and any youth employment standards.

According to the Labor Department, internships may be unpaid if they meet the following six criteria:

  1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
  2. The internship experience is for the benefit of the intern;
  3. The intern does not displace regular employees, but works under close supervision of existing staff;
  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 for the time spent in the internship.
An article in The Chronicle of Higher Education this week includes comments from some campus officials who worry that the new rules will scare off employers who want to provide educational (but unpaid) experiences to students. One concern is that meeting a set list of criteria leads to more risk for those employers. Others disagree. Janet Nepkie, a professor of music and music industry at the State University of New York at Oneonta, tells the Chronicle she isn’t worried about complying with the new rules, as she has a good working relationship with each employer who “hires” interns from her school. (Nepkie oversees the internship program in her department.)

The Labor Department rules agree with the notion that internships existing as partnerships between employers and colleges are best, and most likely to comply with the new regulations. According to the Labor Department: “The more an internship program is structured around a classroom or academic experience as opposed to the employer’s actual operations, the more likely the internship will be viewed as an extension of the individual’s educational experience (this often occurs where a college or university exercises oversight over the internship program and provides educational credit).”

We know sometimes students have no choice but to apply for internships led by private companies and organizations, and outside of their colleges’ control. Some of those experiences offer not only stipends or salaries but benefits as well, since the students are considered more than interns but temporary employees. What do you think about unpaid internships? Should there be more oversight, as the Labor Department hopes there will be now?

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