It’s Just Business: How Corporate America Made Slaves of the Young

Posted on Aug 9, 2012

By Christian Neumeister

(Page 2)

Although the Forbes article has a hyperlink to the Labor Department criteria, which appear in government documents under the heading “The Test for Unpaid Interns,” Harrison does not present them in full. Here they are: 

1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
2. The internship experience is for the benefit of the intern;
3. The intern does not displace regular employees, but works under close supervision of existing staff;
4. The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded;
5. The intern is not necessarily entitled to a job at the conclusion of the internship; and
6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

If those standards seem naive and a departure from contemporary practices, it may be because they were enacted in the Fair Labor Standards Act of 1938. But nonetheless they are the law, regardless of how often businesses violate them. The primary message of the official standards is that an unpaid internship must stem from the good will of the employer, which must provide education to the intern and receive nothing in return.

These government criteria come with a caveat, however: The rules apply only to internships at for-profit organizations. There are exceptions for nonprofit and government work, in which interns can be called “volunteers” (those exceptions are currently under review by the Labor Department). But Chris Tilly, director of UCLA’s Institute for Research on Labor and Employment, does not absolve nonprofits from criticism. He maintains that nonprofits’ heavy use of unpaid interns, apart from having negative effects on the young employees, is detrimental to the organizations themselves. “Nonprofits need to be sustainable, which includes sustainable careers,” he said in a telephone interview. Unpaid internships, he pointed out, involve a quick turnover rate, which detracts from the viability of long-term positions at a nonprofit.

* * *

Internship conditions vary considerably according to the size of the company involved. Whitney Green, a former executive of the Walt Disney Co., told Truthdig, “It’s work for a company to have to do it legitimately [employ interns]—you have to teach [them].” She went on to say that Disney has only two or three corporate internship slots and does pay its interns. Green noted that many smaller companies keep payrolls down by using unpaid interns in the production of low-budget films.

Here’s one example of how a small company—in this case a Brooklyn merchandiser—uses an intern to lower company costs. The unpaid employee, a junior at Claremont McKenna College in Southern California, said in an exchange of emails with Truthdig that he enjoys his job and that “while I get my fair share of ‘intern work,’ like making deliveries … using the subway or a minivan, I’ve also had my fair share of more substantial responsibilities: opening new accounts, negotiating deals with buyers, drafting applications for substantial grants, cleaning up and streamlining [the] sales database and managing a campaign to bring the product to college campuses.” Although he is benefiting from the work experience and isn’t complaining, an outside look reveals that the company is violating some of the criteria set by the Department of Labor.

Even though the particulars differ, it’s almost as if this intern’s employer had read Forbes’ article. Harrison, the writer, gives five ways that employers can benefit from interns, most of which fly in the face of her advice that businesses pay interns. For instance, her second tip: “Offloading: Even unpaid interns can take on some of the more time consuming tasks that every organization must deal with. …”

No, they can’t. The Department of Labor says so. Check out requirement No. 4 in the list above.

Assume that an unpaid intern is being used to operate a business’ social media campaign. Such a program clearly adds to the value of a company. If you want an unpaid intern to work on social media for your business, he or she must do it alongside a paid employee performing that function and must be in a position to learn about how a company uses social media. An unpaid intern working alone on social media is not in an educational environment; probably would be displacing an employee who would normally work on social media; and surely would produce immediate advantage for the employer. All of which violate the official criteria.

Which brings us to a key question: How does an intern get fair compensation in today’s marketplace? Interns are usually desperate, and companies exploit that. Some employers feel that an unpaid intern has received enough reward by simply being hired, and they also play on the emotional pressure inherent in the arrangement—interns’ anxiety about asking for money.

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I myself am an intern, and when the time came during the hiring process for me to ask about compensation I hesitated to do so out of concern that I would immediately be shown the way to the door. I did ask, and I was not thrown out, but the fear is very real for prospective interns across the country.

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