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For many college students, summer is a time for them to build skills through summer internships. Employers are also frequently attracted to the use of unpaid interns, especially in this era of budget tightening. Many employers, however, are not aware of the legal ramifications of using unpaid internships.
The minimum wage requirements of the Fair Labor Standards Act apply to any person an employer “suffers or permits to work”. Generally, an unpaid internship is permissible only if the internship program meets all of 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 operation 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.

As can be seen by this criteria, the use of unpaid interns for work that an employer would generally assign to an employee is generally not permitted. An employer usually cannot use interns to augment an employer’s workforce. If the employer would have hired additional employees or require existing staff to work additional hours had the intern not performed the work, the intern will be considered an employee and entitled to compensation, including overtime compensation to the extent the intern works more than a forty hour week.

Virginia employers should use care in establishing internship programs. Unless the interns are paid a minimum wage, it is essential an employer meet all six criteria set out by the Department of Labor in order to ensure compliance with the Fair Labor Standards Act.