At the beginning of April, we brought the subject of internships to the attention of our readers, making particular notes on how to recognize whether an employer was adhering to Indiana state and federal employment laws regarding payment. This, in turn, raised an all important question: how can you tell if an internship is really following proper employment laws?
Here in lies the problem though because when it comes to many recent court cases, judge's seem to be split on how they choose to interpret state and federal labor laws. In a recent case against Hearst Magazine, one unpaid intern claimed that he not only proofread and edited articles for submission but coordinated the work of several of the magazine's cartoonists for his internship, all without compensation. While this type of work would appear to fall under the Department of Labor's definition of providing an advantage to the employer, a federal court judge ruled against the former intern and any subsequent class actions against the company.
But on the otherhand there are court judges, such as one district court judge from Manhattan, that has wholeheartedly agreed with the Department of Labor's description of an unpaid internship and ruled in favor of two interns who were not paid for their services on the set of "Black Swan." In both cases, the interns were asked to provide services that would give an employer an advantage and allow them to turn a profit, which would entitle the interns to wage compensation. But it's because of split decisions in court that make future cases a bit more difficult to hash out.
So will we see the end to unpaid internships in the future? It's unlikely, but some companies could start seeing this form of employment as more of a liability, with the risk of being sued outweighing the chance to offer a teaching moment. But like we stated back in our April post, employer's only have to fear litigation if they are violating the classifications of an unpaid intership and trying to get away with it as well.
Source: The Atlantic, "The Court Ruling That Could End Unpaid Internships for Good," Jordan Weissmann, June 12, 2013