Consequently, the Labor Commissioners Office is lifting the suspension of enforcement of the "in-person" training requirements, established by AB 547 (2019). If your company has been considering taking on some interns of your own, you may be wondering whether or not you need to pay them. California Minimum Wage Effective January 1, 2023 $15.50 per hour for workers at businesses with 26 or more employees. There is a second category of intern-like workers who, under appropriate circumstances, can also be exempt from state and federal overtime and minimum wage requirements. In fact, intern is a specific term-of-art that means anyone who already holds an advanced degree in medicine (either general or veterinary) and is working in a resident or internship program pursuant to the practice of their respective medical profession (i.e., medical interns like the characters on the TV show Scrubs). As with employee exemptions such as the professional, administrative, outside salesperson, and computer professional, the tests used to determine the legality of internships are qualitative. I want to thank Jon for helping with my contractor problems!! The extent to which an interns work complements the work of paid employees instead of displacing it. In 2010, the California Division of Labor Standards Enforcement (DLSE) recognized this problem and adopted the Department of Labors and Fair Labor Standards Acts six-factor test for determining if an internship should be paid. But, rather than looking at such informal expectations, the DLSE found this criterion was met because the agreements signed by the interns made it clear that they had no entitlement to a job at the conclusion of the program. The extent to which the internship is designed around the interns educational commitments and academic calendar. Our article " An Employer's Guide to New 2011 Laws " covers the six stringent California DLSE criteria: : Employers should carefully review their agreements with internship participants and any educational institutions to ensure that the language of these agreements reflects these criteria. (In Wallings example, trainees learned the operation of machinery in a railyard). These state standards are dictated by the Division of Labor Standards Enforcement (DLSE). The Federal Labor and Standards Act is the primary body of law governing employment and labor laws in the United States. Trainees or interns should not be performing unsupervised work during their time in the position. If you are an employee who was paid on a piece rate basis during the period of July 1, 2012 through December 31, 2015, the Labor Commissioners office may have collected wages for you from your employer for rest and recovery periods and other nonproductive time. informational purposes only and does not constitute legal advice. The trainees clearly understand that they are not entitled to wages for their work time. For example, California's Division of Labor Standards Enforcement ("DLSE") has historically required that for an individual to be considered an intern, his or her training "must be an essential . Whenever I have a question relating to my employees, I call Coast Employment Law. Consequently, for-profit employers who intend on using "unpaid interns" should carefully evaluate their business model to ensure that a bona fide intern relationship exists. For many years, the federal DOL has imposed a 6-factor test in order to determine whether an unpaid internship is lawful. But employers should beware: just because a person is willing to take an unpaid internship does not mean that the employer is off the hook for paying wages. This guide will help you understand exactly what is and is not legal in regards to internship positions. This office is also known as the Division of Labor Standards Enforcement (DLSE). : No, but such employers run the risk of violating a gauntlet of wage and hour laws, both federal and state. With the economy still in the midst of recovery and unemployment figures at historical highs, unpaid internships have become more commonplace then ever. Most un- or low-paid student workers in California are in fact trainees rather than interns. business matters both nationally and internationally. In essence, an internship program will be deemed to exist only if the interns are performing some work as part of an educational, or vocational, program that satisfies ALL six of the above-mentioned criteria. To count as a legitimate internship, must an intern receive school credit for their work? Plus, they might incur additional penalties under California Labor Code Section 203 for failure to pay all wages due at the end of employment within 72 hours, as well as any attorneys fees incurred through litigation. Employers should consult experienced employment counsel to ensure that their internship programs are in compliance. The training, even though it includes actual operation of the employers facilities, is similar to that which would be given in a vocational school; The training is for the benefit of the trainees or students; The trainees or students do not displace regular employees, but work under their close observation; The employer derives no immediate advantage from the activities of trainees or students, and on an occasion, the employers operations may be impeded; The trainees or students are not necessarily entitled to a job at the conclusion of the training period; The employer and the trainees or students understand that the trainees or students are not entitled to wages for the time spent in training. business, commercial lease review, employee disputes, independent contractors, construction, and personal matters such as preparing a will, living The extent to which an internship is tied to an interns formal education program through coursework or academic credit. as a summer associate in May 2005, he has practiced exclusively in employment law and has been involved in matters pending before federal and state courts and administrative agencies covering the gamut of employment-related matters from discrimination and workplace harassment to wage/hour disputes and affirmative-action compliance. Trainees cannot receive employee benefits. %PDF-1.4 % The training must be: The first criterion, similarity to vocational training, appears problematic, because many internships may bear little resemblance to vocational school. The Division applied the six factor conjunctive test utilized under federal law in reaching its conclusion: 1) The training, even though it includes actual operation of the facilities of the employer, is similar to that which would be given in a vocational school; 2) The training is for the benefit of the trainee, 3) The trainees do not displace regular employees, but work under close observation, 4) The employer that provides the training derives no immediate advantage from the activities of the trainees and on occasion his operations may actually be impeded, 5) The trainees are not necessarily entitled to a job at the completion of the training period. Current schedule of meetings available for the public Public Meetings. The intern(s) must be aware that the internship is unpaid. 0000011245 00000 n If the intern primarily benefits from the relationship, the internship can be unpaid. Trainees vs. Of course, if an employer has any doubt, it can always pay an intern applicable minimum wages and otherwise treat him or her as a full-fledged employee. By combating wage theft, protecting workers from retaliation, and educating the public, we put earned wages into workers' pockets and help level the playing field for law-abiding employers. In an opinion letter dated April 7, 2010, the DLSE explicitly overturned its previous 11-factor test, in favor of the 6-factor test applicable under the federal Fair Labor Standards Act ("FLSA"). A person who chooses to donate their non-work hours to organizations such as the Red Cross is considered a volunteer. Child labor: Prohibited construction work (Labor Code 1294.1) 2002.06.13-2. Internships at the State of California are unpaid positions providing students with practical experience. Scroll through other postings and a similar pattern will emerge: Interns are expected to possess all-star abilities and put forth Herculean effort, yet they are offered little to no pay in return for their work. While the DLSE had previously set forth an additional five criteria that employers must meet to lawfully employ unpaid interns in an opinion letter, these additional factors were repealed in a 2010 opinion letter issued at the request of a non-profit organization called Year Up, Inc. In valid trainee arrangements, employers will not be required to pay minimum wages and/or overtime because the trainees will not be considered to be employees, hence minimum wage and overtime rules will not apply. client relationship. The first criterion, similarity to vocational training, appears problematic, because many internships may bear little resemblance to vocational school. Generally speaking, if your companys internship program is not compliant with the law, the intern will become classified as a traditional employee. The extent to which the internship is connected to the interns educational program. They also offer large companies a nearly endless source of free labor to stock their offices with. 0000020788 00000 n However, there are some exceptions, including unpaid internships. See, DLSE Opinion Letter dated April 7, 2010. On the federal level, the Department of Labor created unpaid internship rules that all states must follow. In the recent DLSE opinion letter, the internship program at issue involved a program wherein all interns were simultaneously enrolled in a local community college, where they were earning up to 14 college credits. Over the years, we have helped countless local companies make sure that their employment practices were fully compliant with the law, and we would love to do the same for you. The intern(s) must not receive any benefits or health insurance. Our employment lawyers are prepared to help you figure out if the employer violated unpaid internship labor laws, and whether you may be entitled to file an employment law claim for unpaid wages. about the legality of a California unpaid internship. When trainee arrangement are invalidated, employers can be held liable for various damages and penalties, including: (1) the difference between what a trainee was paid per hour that he or she worked (if anything), and the applicable minimum wage; (2) time-and-a-half and/or double time pay for all hours the trainee worked in excess of 8 hours in a single day, in excess of 40 hours in a single week, or on the 7th consecutive day of work; and (3) fees ranging from $100 to $250 per each trainee who was not paid proper minimum wages and/or overtime, per each pay period that the trainee(s) was/were not properly paid. They cannot simply label a particular low-level or menial job an "internship," and thereby get the work done for free, instead of hiring an employee to perform that function. Effective January 1, 2023, janitorial employers must begin compliance with these training requirements once the list of qualified organizations is posted on this website. In addition to the minimum wage owed to any unpaid interns, the employer could face liability for overtime wages, missed meal and/or rest periods, unpaid employment-related taxes, attorneys fees and various penalties under Californias Labor Code (including waiting-time penalties for failing to pay wages on a timely basis). While the five additional tests are no longer an official part of Californias laws regarding unpaid internships, they may still be utilized by courts as part of a close examination of an individual intern position. Is not compliant with the economy still in the United States operation of machinery a. 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