The U.S. Court of Appeals for the Second Circuit (which includes Connecticut) recently revisited the question of when an unpaid intern is actually an intern, as opposed to an employee. This time, the Court focused on whether the internship provided sufficient “training” to qualify as an internship even though the interns were often performing menial and/or repetitive tasks.
As set forth in two previous posts by my colleague Margaret Bartiromo (located here and here) the Second Circuit Court of Appeals has established a seven part test to determine whether an intern is truly an intern or is really an employee. The test focuses on whether the intern or the employer was the primary beneficiary of the experience. The meaning of “training” is at the heart of the recent decision in Wang v. The Hearst Corporation. The issue is the second step of the “primary beneficiary” test established by the Second Circuit in Glatt v. Fox Searchlight Pictures, Inc.: “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.”
The case was brought by several interns at the Hearst Corporation. All the internships were unpaid and carried no expectation of eventual full-time employment. Additionally, they all required the intern candidate to receive approval for college credit prior to participating in the internship. Four of the interns were enrolled in college at the time of the internship. The fifth was between her graduation from college and the start of her graduate program. While all of the candidates received prior approval for college credit, one intern later declined the credit and one intern’s college ultimately rejected the credit because the internship was not applicable to his major.
In Wang, the interns suggested that they were really employees because the work they were performing was often menial and repetitive. Many of them claimed they did not receive close supervision or guidance and that the internships offered little in the way of formal training. A common complaint was that they mastered most of their tasks within a few weeks, but did the same work for the duration of the internship. For example, one intern complained of having to take minutes when attending marketing meetings. Another complained of learning about photo shoots despite already knowing how to use a camera. All the interns complained of engaging in repetitive tasks even after having learned to successfully perform them.
The Second Circuit previously noted that a key element in determining the intern relationship is the “expectation of receiving educational or vocational benefits.” The Court noted that the gaining of practical skills may require practice and exposure to the day-to-day professional experience within the chosen industry. Thus, requiring interns to perform repetitive tasks and/or tasks they have already mastered does not change them from interns into employees. The Court ultimately found that the plaintiffs in Wang truly were interns, based in large part on the vocational skills that they were learning during their internships.
The proper classification of interns is important because the penalties for misclassification can be significant. Before taking on unpaid interns, it is important to establish that the positions truly are intern positions designed to benefit the intern more than the business.