top of page

Part II Rethink Internships - 6 Criteria for Unpaid Compensation

Updated: Jan 13, 2023

People take time, especially when working with interns. What's amazing to me is that some schools tell their students not to take an internship if unpaid. I believe that's poor counsel because some employers provide a phenomenal experience.

It takes a good three months to train an intern in their role. Think about it, the student has to learn an industry, company culture, communicate with staff in other departments, personality types, products and services of the business, customers and a job they're being trained to see if they like the job. The business spends sizable amounts of time, energy and money training the student to learn a skill. Schools charge to learn theory. Businesses provide experience that backs up the theory. Not everyone lands an internship. Employers look for the extraordinary student that stands out.

I challenge employers to Re-Think their intern program, or lack of a program and bring real value to business owners, leaders, managers and HR managers by creating an intern program that serves the unique needs of the intern first and results in a bigger return for the business - an end-to-end system that protects all parties.

internship word cluster chart

I've consulted with business leaders and owners, entrepreneurs, nonprofit executive directors, and HR managers regarding organizational performance gaps and lack of documented systems. Many times employers want to tap into intern talent. I remind them that this demographic has specific compliance demands that require a program focused on their unique needs. For example, when working with intern talent it requires a blended approach of academic and HRD strategies.

What does it cost to design the program? It costs something more valuable than money.


Most employers don't have a structured end-to-end intern program. I've invested six years researching and creating a program that improves and can stabilize a business and provides a high touch experiential program that benefits the intern that's built around the 6 DOL criteria. So what should you pay attention to?

  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 doesn't 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 isn't necessarily entitled to a job at the conclusion of the internship;

  6. The employer and the intern understand that the intern isn't entitled to wages for the time spent in the internship.

According to the DOL guidelines, if all of the factors listed above are met, an employment relationship doesn't exist under the FLSA, and the Act’s minimum wage and overtime provisions don't apply to the intern. This exclusion from the definition of employment's quite narrow because the FLSA’s definition of “employ” is very broad. Some of the most commonly discussed factors for “for-profit” private sector internship programs are considered below.


bottom of page