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Do interns have to be paid?

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in Compensation and Benefits,Hiring,Human Resources

Q. We plan on hiring a college intern this year. Do we have to pay that person? —L.M., New York

A. If an intern secures education, class credit and experience from working at your company, the “flow of benefits” is equal, so you aren't required to pay the intern. But if you profit too much from the arrangement, federal law says that would suggest an employment relationship, meaning you must pay your intern.

To avoid having to pay student interns, know the Fair Labor Standards Act (FLSA) rules. They say interns must be paid at least the minimum wage if your program fails to meet the following “learner/ trainee” rules: (1) The training must be comparable to that given at a vocational school. (2) The training must benefit the student. (3) The intern does not replace a regular employee. (4) The employer does not immediately benefit from the intern's activities. (5) No promise of a job following the training exists. (6) Both student and employer understand that no wages will be paid for the training period.

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