01-17-2018
Over the last few years, the question of whether someone could be considered an intern has been heavily litigated. The U.S. Department of Labor (DOL) had devised a six-part test to be used to determine whether someone should be classified as an intern or an employee under the Fair Labor and Standards Act (FLSA). Interns are not entitled to wages. The fundamental issue was that an employer could not derive “immediate advantage from the activities of the intern” for an individual to qualify as an intern.With 2018, it is out with old and in with the new. The DOL has issued a new test. Going forward, the focus of the intern or employee inquiry will be who is the “primary beneficiary” of the internship. To ascertain who is the “primary beneficiary” (i.e., the employer or the intern) seven factors will be evaluated: 1) what is the expectation of compensation; 2) whether the training is akin to what would be given at a school; 3) whether it is tied to the intern’s formal education; 4) whether it accommodates the intern’s academic commitments; 5) whether the internship is limited to the duration of its benefit; 6) how the work of the internship compares to the work of paid employees and that it provides significant educational benefits; and 7) the understanding that the internship will not lead to a paid job after its conclusion.
The test is intended to allow for “increased flexibility to holistically analyze internships on a case-by-case basis.” Several circuit courts, including the Seventh and Ninth, were already using a similar test.