How Misclassification Can Lead to Unpaid Wages

Intern programs are an attractive entry-point to gain work experience. Many students and people who have difficulty landing a position in their chosen field are eager to “get their foot in the door.”

Some trade pay for experience, agreeing to work for no pay or below minimum wage.

On the other hand, some employers believe they provide an opportunity and either ignore or do not understand federal wage and hour obligations with respect to “interns.”

Interns and Unpaid Wages

As a general rule, an employee, defined as “any individual employed by an employer”, must be paid at least the federal minimum wage, pursuant to the federal Fair Labor Standards Act (“FLSA”), among other obligation imposed by the FLSA.

An employee may also be eligible for overtime compensation under the FLSA.

If the internship meets very specific requirements, the Fair Labor Standards Act payment provisions will not apply and that intern may work as an unpaid intern. The requirements adopted by the U.S. Department of Labor to identify interns (i.e. individuals who are part of programs that provide training for their own educational benefit are) are found at U.S. Department of Labor Fact Sheet 71.

To summarize, the employer must satisfy the following six criteria to avoid payment of wages as mandated by the FLSA:

1. The internship is similar to training that would be offered in an educational environment;
2. The internship is for the benefit of the intern;
3. The intern does not displace a regular employee, but works under the close supervision of existing staff;
4. The employer that provides the training derives no immediate advantage from the activities of the intern, and, on occasion, the employer’s actual operations may be impeded;
5. The intern is not necessarily entitled to a job at the completion of the internship; and
6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

Misclassification Leads to Unpaid Wages

Over the past several years there have been several high-profile cases in which hundreds of “interns” were awarded unpaid wages because they had been misclassified as “interns” and were not paid in accordance with the FLSA. Damages in an FLSA action also include a claim for liquidated damages, attorneys’ fees and costs.

If you believe you were not paid all wages due during an internship, contact Wenzel Fenton Cabassa P.A.

We will gladly review the facts of your claim to determine if that summer introduction to the working world was really a qualified internship or if it was a summer job for which you are entitled to wage payments.

Please Note: At the time this article was written, the information contained within it was current based on the prevailing law at the time. Laws and precedents are subject to change, so this information may not be up to date. Always speak with a law firm regarding any legal situation to get the most current information available.