Internship vs. Employment

How to differentiate between internship versus employment—6 point test same test for Feds and State, if met then have a legitimate internship.

Compensation: Internships may be paid or unpaid.

Paid Internships: The Department of Labor requires that paid interns be paid at least minimum wage. Intern wages can vary. Please research wage ranges within your industry and geographic area.

Unpaid Internships: Summarized from the Fair Labor Standards Act Fact Sheet #71 of April 2010, the following six requirements apply to unpaid internships:

1. The work performed is an extension of a trade studied by the student. Although the training might include equipment and procedures specific to the employer, it must consist primarily of experiences similar to those offered in a vocational school and be directly related to the training and the educational objectives. It's not enough just to put the interns to work with supervision.

2. The training must be primarily for the benefit of the intern. For example, the intern earns college credit or valuable work experience. That means the intern can't just be making coffee, running errands, or catching up on filing. Although such tasks might be incidental to the position, the majority of the experience must be designed with the intern's education in mind.

3. The intern must not displace regular employees and must work under close observation. Farming out work to unpaid interns after a regular employee quits would raise a red flag.

4. The employer gains no “immediate advantage” from the student’s work. The courts consider billing clients for work performed by an intern an immediate advantage. Although an internship program will benefit an employer's business over the long term by providing a pool of trained applicants with familiar work habits, it's not meant to be a source of free labor.

5. The employer makes no promise of future employment.

6. The intern understands that he or she is not entitled to wages for the time spent in the internship or in training.

Insurance

The San Diego Community College District shall, pursuant to the provisions of Education Code Section 78249, be considered the employer of students participating in the Work Experience program as unpaid interns for the limited purpose of providing worker's compensation insurance and shall provide such insurance at the District's own cost and expense.