Navigating Summer Internships: Internship Law and FLSA Guidance for Employers
As summer approaches, businesses across industries begin welcoming a new wave of interns—often eager students or recent graduates seeking hands-on experience. While internship programs can be mutually beneficial, they also come with important legal responsibilities for employers. Poorly structured internship programs can lead to costly consequences, including wage and hour claims, compliance violations, or reputational damage. That’s why it’s essential for employers to understand the legal framework that governs internships before onboarding summer help.
Understanding Intern Classifications and Compensation
The most pressing legal question employers ask is, “Do I have to pay my interns?” The Fair Labor Standards Act (FLSA) requires that employees be compensated for their work, but not all interns qualify as employees. The U.S. Department of Labor applies what’s known as the “primary beneficiary test” to determine whether an intern or student is, in fact, an employee under the FLSA. This test considers many factors, including:
- The extent to which the internship provides educational training
- Whether or not the internship complements or displaces the work of paid employees
- The degree to which the intern and employer understand that there is no expectation of compensation.
If the intern is the primary beneficiary, the internship may be unpaid. However, if the employer reaps the primary benefit, then the intern must be compensated at least minimum wage and overtime, if applicable. Employers should also be mindful of state-specific laws and regulations related to internships and compensation.
Intern Protection from Discrimination and Harassment
Interns, whether paid or unpaid, are protected under the same anti-discrimination statutes that safeguard full-time employees. This means that employers must provide a safe and inclusive work environment, free from unlawful harassment or bias. Interns should be given clear guidance on workplace policies, reporting procedures, and behavioral expectations to ensure they are being treated fairly and respectfully. Ensuring access to these protections will ensure legal compliance and support ethical business practices.
Written Internship Agreements
Documentation is another area where employers can ensure protections for their business and interns. Establishing a written internship agreement that outlines the intern’s role, learning objectives, schedule, supervision, and compensation status can help clarify expectations and demonstrate compliance with labor standards. When drafting, employers must avoid language that implies an employment relationship if one is not intended. A well-drafted agreement serves as a reference point for both the intern and employer, prompting accountability and transparency throughout the program. Walcheske & Luzi can provide support with drafting an internship agreement.
Providing Meaningful Learning Opportunities
Employers should also consider the nature of the tasks assigned to interns. Interns should be engaged in work that enhances their educational experience rather than serving as free labor to handle routine administrative tasks or substitute for regular employees. Providing meaningful learning opportunities will keep employers legally compliant and help to build a pipeline of future talent. A meaningful and well-structured internship program benefits the organization in the long run by fostering goodwill and developing skilled future hires.
Confidentiality and Intellectual Property Concerns
Privacy and intellectual property rights should be addressed when interns are exposed to confidential information or involved in creative or technical projects. To safeguard business, employers should have interns sign confidentiality agreements if necessary, ensuring that sensitive data is protected, and ownership of work is clearly established. This step is especially important in industries where interns may contribute to product development, marketing campaigns, research, or proprietary systems.
Internship programs can be a rewarding investment in the future workforce when thoughtfully structured within the bounds of the law. By taking the time to understand and implement internship laws best practices, employers can avoid legal pitfalls and provide valuable experiences that benefit both the intern and the organization. If you’re unsure whether your internship program meets legal standards or you need help drafting a compliant internship agreement, contact Walcheske & Luzi today for a consultation.