Some of the confusion regarding this issue may have been clarified by the Department of Labor’s recent announcement that it is abandoning the six-part test that it has used in the past to determine whether an intern is an employee entitled to pay under the FLSA. On January 5, the DOL announced that going forward it would utilize a “Primary Beneficiary” test to make that determination.

The DOL also issued a Fact Sheet that lists the criteria that it will now consider:

  1. The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa.
  2. The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.
  3. The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.
  4. The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar.
  5. The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.
  6. The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.
  7. The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.

Our HR Experts can provide you with guidance on this and other complex wage and hour issues.

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