An unpaid intern at Harper’s Bazaar magazine (a Hearst Corporation division) has filed a lawsuit alleging that federal and state wage and hour laws were broken during the internship, primarily due to not receiving compensation. Many companies in the fashion and entertainment industries utilize interns in an unpaid manner due to the allure and overwhelming interest students have in interning for a professional sports team, movie production company, fashion magazine, major recording label, etc. Pair this popularity with a competitive job market and entry level employees who are looking for every advantage to being offered a full-time position; and companies will have no problem finding droves of students willing to put in hours and workloads equal to what regular full-time employees contribute.
The question which is at hand is whether the internship positions and duties are replacing regular full-time workers, thereby violating the U.S. Department of Labor Wage and Hour Division’s statement on internships as they relate to FLSA. Internships are supposed to be designed to compliment and benefit a student’s education first: not designed to benefit the company providing the internship.
In other industries (engineering and biotech/pharmaceutical to name a few) interns are typically managed and categorized as paid employees or co-ops (Cooperative Education). Some companies realize that the work (and job description) students perform contribute on some level the same as a full-time regular employee’s. Having consistent standards and procedures when engaging interns and co-ops will ultimately mitigate a company’s exposure to FLSA lawsuits and streamline the resources a company spends on program administration. Arguable one of the most popular methods of handling interns/co-ops is to treat them the same as any other contingent worker at the company. Either way it appears that the above lawsuit will open the door for many more just like it or persuade companies to provide compensation to their interns directly or through a third party.
Links to other news as it relates to unpaid internships: