The college year is soon ending, and many students will become unpaid interns for the summer. But, regardless of the industry, employers need to be careful if they simply assume they don’t have to pay them.
The Department of Labor has set out a six-part test to determine whether interns must be paid. But the Fourth Circuit has made it a little easier. It has expressly rejected the Department of Labor’s six-part test in favor of its own: whether the employer or the intern principally benefits from the arrangement.
In other words, if the internship “principally benefits” the employer, the interns must be paid. But if it “principally benefits” the intern, they can legally work for free. The difficult part, of course, is determining who benefits.