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Are unpaid internships legal in Maryland?

On Behalf of | Apr 5, 2012 | Employment Contracts |

Many Greenbelt area businesses have interns. Often college students, interns are ambitious, educated and very eager to gain real-world work experience. As such, they are often willing to work for very little or no money–content to earn only a line of their resumes.

There has been concern however that not paying interns may violate federal employment law, and lawsuits have recently sprung up regarding this issue. For an unpaid internship to be legal at a for-profit business, it must pass a federal test. To pass, it must meet six criteria.

  • The internship must be for the benefit of the intern.
  • The internship must provide training that is similar to what would be provided in an educational setting.
  • The intern cannot take the place of regular employees, but works under supervision of existing staff.
  • The employer does not reap any immediate benefits from the intern’s work; at times the employer’s operations may be hindered.
  • Both the employer and the intern understand that the intern is not going to be paid.
  • The intern is not entitled to a paid job at the end of the internship.

When all of those factors are met by an internship, an employment relationship does not exist under The Fair Labor Standards Act and thus the intern is not protected by minimum wage and overtime laws.

Even when internships meet these criteria, they can be controversial. Some think interns are often exploited and others think interns inadvertently take jobs away from employees. Nonetheless, employers are expected to hire more interns this summer.

The National Association of Colleges and Employers conducted a survey that found 280 companies polled plan to increase their hiring of interns by 8.5 percent this summer. Because interns are paid less than full-time workers, if anything at all, this gives employers a cushion in a recovering economy. Employers and interns may want to consult with employment attorneys to ensure an internship program meets federal standards.

Source: The Sacramento Bee, “Job Front: Hiring picture brightens for interns,” Darrell Smith, March 5, 2012