For college students looking to beef up their qualifications with professional experience, internships can be invaluable. They get on-the-job training, college credit, and that all-important bullet point on their resumes. Often, internships can lead to full-time jobs after graduation.
Employers have just as many reasons to love internships. You can hire young professionals at the start of their careers and assess their qualifications without a long-term commitment. And because they are working for you for the sake of the experience, interns are often less expensive than your more experienced employees. They are often earning money, but they also see internships as training programs to some extent.
However, you should know that interns are not free labor. Federal law requires you to pay them under most circumstances. In some states, more regulations exist. But for our purposes in this article, we will focus on the internship payment rules under the Fair Labor Standards Act (FLSA). We will then offer tips for crafting an internship offer letter that complies with the law.
In the vast majority of circumstances, employers must pay their interns at least minimum wage, with overtime pay when applicable. These paid interns are considered temporary employees under the law, and therefore you must treat them just like any other employee.
However, the FLSA does allow for unpaid internships in a small number of cases. To qualify, internships must meet all the conditions of this seven-part test:
One exception to the minimum wage rule is the “student learners” designation. If you register your business or organization with the Department of Labor, you may pay student employees 75 percent of the minimum wage. The law requires that these student learners be at least 16-years-old, enrolled in an accredited school, college, or university, and working for you part-time.
Before you hire an intern, you’ll need to create the position. Will your internship be paid or unpaid? You might want to consider hiring paid interns only, as this will ensure that you are in compliance with the internship payment rules under the FLSA.
However, there may be some circumstances in which it makes more sense to take on unpaid interns. Perhaps your alma mater or a local university has asked you to take on an intern. This happens frequently. Many professional degree programs require students to do field placements in the real world prior to graduation. The university often has a team of staff working to help place their students in internship programs with local employers.
As a leader in your field, you want to help the next generation of young professionals. You want to teach them the right way to do their jobs because it will improve the field you work in. You might also figure that offering a valuable educational opportunity will be good PR for your organization.
If you are, in fact, interested in offering an internship solely for the educational benefit of the intern and not because you are in need of additional staff, you might choose to take on an unpaid intern.
Regardless of the paid or unpaid status of your internship, you should include the following elements in your offer letter:
If you are offering an unpaid internship, it is important that your internship offer letter does not make any statements that would render the position unqualified for unpaid status. Therefore, you should avoid the following in an offer letter for an UNPAID internship:
If your organization plans to take on interns, make sure you fully understand the FLSA as it applies to internships. These part-time positions can provide a lot of benefits to students and employers. But if you violate the law, you might be in for some hefty fines, not to mention a damaged reputation. If you want to hire interns but you’re still unsure of how to do it legally, contact an employment attorney. They can help you craft a great internship program that is fully compliant with the law.