Sum­mer intern­ships offer stu­dents oppor­tu­ni­ties to gain real-world expe­ri­ence and hands-on career devel­op­ment. Con­verse­ly, intern­ship pro­grams give employ­ers access to high­ly moti­vat­ed and edu­cat­ed young work­ers and give junior man­agers more expe­ri­ence train­ing and super­vis­ing. There are ben­e­fits for every­one involved.

How­ev­er, there are some peo­ple risks that many employ­ers over­look. One of the largest issues is deter­min­ing what interns should be paid – or not paid.

The Depart­ment of Labor issued new guid­ance on Jan­u­ary 5, 2018, that gives employ­ers more flex­i­bil­i­ty in decid­ing whether to pay interns. A sev­en-cri­te­ria test is now used to deter­mine if an intern­ship may be unpaid, but the biggest change is that not all fac­tors need to be met – no sin­gle fac­tor is deci­sive, and the deter­mi­na­tion is made on the unique cir­cum­stances of each case.

If the job train­ing pro­gram pri­mar­i­ly pro­vides pro­fes­sion­al expe­ri­ence that fur­thers a student’s edu­ca­tion­al goals, a stu­dent may not be con­sid­ered an employ­ee enti­tled to com­pen­sa­tion. How­ev­er, if stu­dents are doing work usu­al­ly done by employ­ees and are not receiv­ing train­ing and close men­tor­ing, they should be paid wages. If there is any doubt, the best approach is to pay the student.

4 Reasons to Pay Interns

How­ev­er, while it’s now legal­ly per­mis­si­ble to clas­si­fy more interns as unpaid, there are still com­pelling rea­sons to pay interns even when the intern­ship does meet the cri­te­ria for unpaid status.

Unpaid intern­ships tend to exclude stu­dents from low­er- and mid­dle-income back­grounds, who can­not afford not to work at paid jobs dur­ing the sum­mer. In addi­tion, they may need to pay up to sev­er­al thou­sand dol­lars for course cred­it, in addi­tion to com­ing up with funds for hous­ing, cloth­ing, and trans­porta­tion relat­ed to the intern­ship. This can put intern­ships out of reach for some of the stu­dents who can ben­e­fit from them the most.

Unpaid intern­ships may deval­ue the work paid employ­ees are doing. After all, interns are work­ing along­side reg­u­lar employ­ees — often doing some of the same tasks — and not being com­pen­sat­ed for that work. This may send the mes­sage to employ­ees that their work, or time, is not valued.

Unpaid intern­ships can cre­ate a neg­a­tive impres­sion of your com­pa­ny. Cus­tomers or the com­mu­ni­ty may see you as tak­ing advan­tage of these stu­dents, which is not the mes­sage you want to por­tray. It’s a good com­mu­ni­ty rela­tions move to offer youth paid opportunities.

The work the unpaid intern is doing may actu­al­ly be work that should be com­pens­able. Improp­er­ly clas­si­fy­ing an intern­ship and not pay­ing the stu­dent could result in wage claims that include back pay, penal­ties, and fines. To mit­i­gate those risks, once again, the best approach is to pay the student.

Hir­ing sum­mer stu­dents is a great way to help youth learn what it takes to be suc­cess­ful in busi­ness while help­ing employ­ers get spe­cial projects com­plet­ed. Plan ahead and struc­ture your pro­gram so that your sum­mer intern­ship pro­gram is a great expe­ri­ence for everyone.


by Rachel Sobel
Orig­i­nal­ly post­ed on