Internships are a rite of passage into certain fields of work, but as the economy continues to struggle, previously paid internship positions in other businesses are turning into unpaid positions.
However, interns for for-profit businesses legally must be paid in most circumstances, according the Department of Labor’s Wage and Hour Division’s website.
Under the Fair Labor Standards Act, interns at for-profits qualify as “employees” and must be paid minimum wage and overtime provisions unless the main purpose of the internship is for teaching the intern.
Nick Cattin, director of career education for Miami University’s Farmer School of Business (FSB), said in most scenarios, Miami students working for for-profits should be getting a paycheck.
“Most people in Career Services would say that for a for-profit industry, you really should get paid,” Cattin said. “Ideally would everybody pay? Yes definitely.”
In New York, two unpaid interns are suing for pay in a high-profile case, but Cattin said until the court rules on the case, Miami students hoping to break into certain industries can expect to take unpaid internships.
“This is going to be really decided by what the court rules in October,” Cattin said. “At this point, without the legal deciding factors, a student should ask ‘How will this benefit my education?’ Currently, as things stand, in some fields you have to have the experience.”
According to the National Association of Colleges and Employers, the two unpaid interns have filed a class-action lawsuit in the U.S. District Court Southern District of New York against Fox Searchlight Pictures for their unpaid work done on the set of Black Swan and for all unpaid wages allegedly owed to all other Fox Searchlight interns since 2005.
The Fair Labor Standards Act defines an intern can only legally be unpaid if the intern is not doing necessary work for the company.
The unpaid intern must not be an employer’s budget solution for not being able to afford a paid staff member. The intern must also not be working unpaid because of a guarantee of a job at the end of the internship.
According to the act, unpaid internships are supposed to be, “for the benefit of the intern” and, “similar to training which would be given in an educational environment.”
Robin Parker, general counsel for Miami, said students are not legally required to get academic credit for an unpaid internship. She said employers will sometimes require students get credit for their internship or register it as an independent study in order to create proof the unpaid internship was for educational purposes.
“But that’s the employer’s decision because they’re the ones who would have to demonstrate that their internship met the requirements of the law,” Parker said.
Jeff Billiel, executive editor of the Sidney Daily News said his paper used to offer paid summer internships but now offers only unpaid internships because of the company’s financial hardship.
“When the economy went south we no longer had the resources,” Billiel said. “If I had my choice I would still offer paid internships, because it allows us to draw [interns] from a broader geographic range.”
Billiel said his last two interns have been Miami students.
Interns were given real world experience under the supervision of the staff and helped cover employee assignments when the regular staff members are on vacation, according to Billiel.
“We need real reporters,” Billiel said. “We don’t bring people in for filing and making coffee.”
This type of experience is needed to get a job in this competitive job market he said.
While the paper cannot afford to pay, Billiel said they try to show their interns they appreciate them in other ways.
“We try to include them,” he said. “We always offer to give them references when they are seeking jobs.”
According to Cattin, unpaid internships can lead to great job offers but can create a disadvantage for poorer students. He said he knew a former Miami student who took out $12,000 in loans as an undergraduate to take an unpaid internship with Katie Couric.
“When he graduated he literally had job offers from five different television stations,” Cattin said. “At the same time, he could afford to do that while another student might not be able to afford that.”
Sonia Melendez, director of media and special assistant to Secretary of Labor Hilda L. Solis at the Department of Labor, said the department will investigate any unpaid internship complaints.
“Complaints about unpaid interns are rare, still, to the extent that the division receives such complaints, we intend to investigate them,” Melendez said. “Our investigators target industries where historically we have found high incidences of violations and where the most vulnerable workers are employed – industries such as construction, janitorial, agriculture and restaurants. That will continue to be our focus.”
Cattin said the challenge is students who confront employers with the regulations for unpaid interns can be easily replaced with other student interns.
Senior Kristen Whaley worked a full-time unpaid internship in New York City in the summer of 2010 for CondÃ© Nast, a publishing house for magazines such as Vogue. In housing alone, she said she spent over $3,500 for her 10-week internship. Whaley said she heard interns talking about how frustrated they were that this was the first year interns were not paid, despite working full-time.
“But it’s not like anyone would say that because the internship is very competitive,” Whaley said. “It’s hard to make a case when someone is willing to work your job for free.”
Miami employs unpaid interns but is a non-profit and not held to the Fair Labor Standards Act’s regulations for interns with for-profit companies.
Cattin said this is in part because the Department of Labor considers for-profits to be more capable of paying interns.
“If you’re getting profits it’s assumed you can pay people to work for you,” he said.
Cattin said this is also because non-profits like hospitals and shelters work with large numbers of volunteers. He said non-profits traditionally classify their unpaid interns as one of their volunteers.
Senior Lauren Romano had an unpaid graphic design in
ternship with the Miami Recreation Center. Romano did graphic design work under the marketing director, and said she learned a lot at the internship and received academic credit.
“I was also a sophomore so an unpaid internship for me then was a good way to get ahead and get started,” Romano said.
Cattin said he and other staff in Career Services do not specifically hold employers who recruit at Miami to the criteria in the Fair Labor Standards Act. However, he said he has told businesses offering an unpaid internship they should offer a paid internship and they would get a better candidate pool if they did.
“Often, if we make those statements they’ll come back and be able to pay,” Cattin said.
Parker said internship recruiters at Miami must comply with labor laws in the same way they are held to other employment laws like anti-discrimination laws.
“All recruiters at Miami must comply with the law,” Parker said.
In 2011, 46 percent of outgoing seniors reported interning while at Miami, according to a survey by the Office of Institutional Research at Miami.
Cattin said students with certain majors, like students he works with in the business school, traditionally can expect paid internships while other cannot.
“It depends on the industry and also depends on your skills and experience,” he said.