Internships were designed as a way for students to get some hands-on training, experience, and make some connections, but employers often take advantage of this system to put students to work for free so they can avoid paying employees. Many lawsuits have been filed against employers by interns alleging they should have been compensated for the work they did.
Although the line between intern and employee can sometimes be a bit vague, the Second Circuit Court recently began recognizing the “primary beneficiary” test to determine if a worker should be classified as an intern or an employee. The test is composed of seven parts, although more factors can certainly be considered. The aspects used by the Second Circuit include:
- Whether both parties agree ahead of time that there is no compensation expected;
- Whether the intern will receive training on par with the kind they would receive in an educational setting;
- Whether the intern can receive educational credit for the internship and/or the internship is connected with some sort of formal education program;
- Whether the internship corresponds with the academic calendar in order to accommodate the intern’s educational commitments;
- Whether the duration of the internship is limited to the period that provides the student with education and experience that benefits them in their education;
- Whether the intern’s work takes the place of work normally done by employees; and
- Whether both parties understand there is to be no expectation that the intern will receive a paid job offer once they’ve completed their internship.