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Expect a bumper crop of eager interns this summer, thanks in part to the still-struggling economy.

While internships can be a win/win situation for employers and students, the arrangements come with potential legal pitfalls that many employers overlook. By identifying and managing these risks, your company can avoid liability and the threat of legal action.

When must you pay interns?

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

Advice: To avoid paying student interns, know the Labor Department rules regarding the Fair Labor Standards Act (FLSA). They say interns must be paid at least the minimum wage if the program doesn't 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 student would not replace a regular employee.
  4. The employer does not immediately benefit from the student's activities.
  5. There is no promise of a job following the training.
  6. Both the employer and the student understand that no wages will be given for the training period.

Limit teen interns' hours

If your intern program reaches out to high schoolers, the FLSA's child labor provisions may curb their hours and duties. In most cases, children age 13 and under are off limits to employers, except for certain odd jobs, like newspaper delivery or baby-sitting.

Youths ages 14 and 15 can work outside of school hours in certain nonhazarous jobs, but their hours are limited to three on a school day, 18 in a school week, eight on a nonschool day and 40 in a nonschool week. Also, they can work only between 7 a.m. and

7 p.m.; the nighttime limit extends to 9 p.m. in summer.

The FLSA says 16- and 17-year-olds can work unlimited hours but not in certain hazardous jobs. Once workers reach age 18, they're free to work any job for unlimited hours. For more details on child labor laws, go to www.dol.gov/ dol/topic/youthlabor.

Also, check your state laws, which may require stricter child labor standards, by going to www.dol.gov/esa and clicking on "State Labor Laws" (right side of page). Also, check whether your state requires work permits or proof-of-age certificates for minors by going to www.dol.gov/esa/ programs/whd/state/certification.htm.

Liability similar to regular staff

Manage interns as closely as employees, if not more so. Reason: Your company can be held responsible for the actions of any workers, including unpaid interns, while they're performing work for you. Courts will view interns like employees, as "agents" of your com-pany. Interns' activities are under the employer's control, not the school's.

What about job-bias lawsuits? Some courts have ruled that employment discrimination laws don't apply to unpaid interns. But that doesn't mean you can slack off on anti-bias efforts. Reason: Unpaid interns may be able to pursue claims under Title IX, which bans sex discrimination in "any education program." Also, interns may be able to file common-law job-bias claims, such as infliction of emotional distress.

Best bet: Apply your company's workplace policies to interns.

YATL adviser Jonathan Landesman, who practices labor and employment law at Philadelphia-based Cohen, Seglias, Pallas, Greenhall & Furman P.C., contributed to this report.

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