Unpaid internships are just not worth it

If you think you need an unpaid internship to get a foot in the door and then a job, I’d like you to meet reality:

The [National Association of Colleges and Employers] released a study this week showing that 60% of 2012 graduates who worked a paid internship got at least one job offer, while just 37% of those in unpaid gigs got any offers. That’s slightly – only slightly – better than the offer rate for graduates who skipped internships entirely, at 36%.

It is no better than no internship at all. Being paid on the other hand is much better, 62% better. And that’s for all unpaid internships, not to mention unfair internships where you surely get no on-the-job training.

Stephen Colbert on Unfair Internships (again)

Money quote:

“You don’t have to be a college student anymore. An employer can just call you an ‘intern’ and then not pay you!”

“We had these in the South 150 years ago: cotton internships.”

(Wish I could embed the video, but my provider does not allow it.)

Spotted: another weak defense of unfair internships

Every now and then, some people bravely stick out their neck to defend unfair internships. The latest is Dreama Lee, from InternProfits, a website apparently dedicated to their promotion, if their welcome video is to be believed (“overworked people and unemployed youngsters; I see a win-win!”). She wrote an open letter to the New York Times, in response to their debate about unpaid internships.

The first third is an irrelevant attack on Ross Perlin’s credentials. Ross is not making an argument of authority, so I don’t see how attacking the fact that he may not be a “faculty member of an institution of higher education” among other things is of relevance.

Then, the author makes a straw man argument (we’ve seen this before): “So the solution, according to Perlin, is to end all internships.” I am not aware of anyone fighting against unfair internships that has ever made such a proposal. Yet, this is the one the author sets up to attack and discredit.

On the fact that some interns are reading Intern Nation, she thinks that the impact will be to “make the future intern feel like their internship is a waste of time and create more of an “entitlement” mentality before the Gen Y’er even steps foot into the employer’s office, further encouraging a stereotype that many Gen X and Boomers absolutely abhor.” She’s convinced that older people thinking that younger people feel “entitled” is a new thing, invented by baby boomers and Generation Y. Actually, it’s such an old and common thing that there’s a word for it: ageism. So yes older people think so and no, it’s not the fault of young people. Apparently, it’s human nature and Gen Y will likely complain about the Zs, even if they also accept to work for free.

But the crux of her argument is that internships also have advantages. That’s a funny way to put it. Who said they don’t? Seriously? This argument is not a defense of internship. Just because a phenomenon or behavior has upsides does not justify it. Speeding is great: it’ll take you there faster and it’s exciting! Why outlaw speeding! Who cares if it’s dangerous! Heck, think of how good slavery was to the economy of the South. It was thriving! Even for the slaves: a guaranteed job, housing, food and even a husband or wife sometimes. Really, with all these advantages, why were people complaining? Think of most illegal, unfair and outrageous behaviours and you’ll find anupside somewhere (robbers do gain stuff after all!). As silly as it sounds, this is how Dreama Lee is justifying exploitation of young graduates who have to accept serial unpaid jobs because they have no negotiation power.

At the end of it all, despite the snark above or the self-righteousness of the open letter, there is not so much difference between the positions of pro and anti-unfair internships. Even the author praises programs that pay interns and is keen that they interns should be learning something, much like we have nothing against real apprenticeships and support good opportunities to learn in a work environment. And I agree with her that the New York Times was not able to find one credible person to defend unpaid internships.

A debate about unfair internships

The New York Times is hosting a debate about unpaid internships (side note: I really wish having been more successful at promoting the use of “unfair internships”). So far, five people have shared their opinion, four against and one in favor. There is Ross Perlin, well-known as the author of Intern Nation, who describes the recent evolution (degradation) of internships. There is Alex Footman, who is suing Fox Searchlight for his own experience as an unpaid intern and who’s making the argument that enforcing the law is he government’s job, not his (agreed). Then, an employment attorney makes the simple point, argued here too that internships are “a valuable idea, if we follow the law”. Raphael Pope-Sussman makes the case that unions should take up the fight to enforce the law and restrict unfair internships (in the UK, the Trade Union Congress does it).

This is all good and thoughtful, but let’s look at the dissenter’s argument. David Law, founder of Above the Law (I’m not joking) makes this interesting argument:

But unpaid internships are more a symptom than a cause of economic weakness. They are so popular right now because many employers, large and small, simply don’t have the ability to create new, full-time, paid positions.

Oh, that’s what it is! The employers really, really want to pay their junior staff, they just can’t afford it! Oh well then. They should pass on the idea to all companies that are going bankrupt: stop paying your staff if you can’t afford it, it’s no big deal. David Law then caps it off with this gem:

In the end, the status quo, while imperfect and inconsistent, may not be that bad.

What he apparently does not realize is that there is no status quo: the situation is getting worse, as Ross Perlin demonstrates. Who, 20 years ago, needed to go through some 5 internships before getting a paid position?

It’s good that the New York Times take up this issue and it’s even better to see that it is so hard to find a good defense of unfair internships.

A Twitter list against unfair internships

It is important for people who fight unfair internships to create a network and support each other. This is why I have a Resources page that list the groups active in this field. And I just updated my Twitter list where there are now 16 accounts. You can follow the entire list at once by clicking the button at the top of the list. Post your suggestions in the comments below or tweet them to me @exintern.

Internships: The Scandal of Britain’s Unpaid Army

The Guardian has two excellent articles on the scandal (their word) of unfair internships. Internships: the scandal of Britain’s unpaid army makes the point that internships are not an option.

With youth unemployment approaching the one million mark, getting to the first rung of the employment ladder has never been harder for Britain’s young people. As competition grows so too have the barriers, including the need to have experience of the workplace before securing a paid job.

Gone are the days when a week’s placement during the school holidays at your parent’s company could make your CV stand out. Now school leavers and even graduates are expected to have months of varied experiences to cut the mustard at interview. The problem, civil servants admit, has become endemic.

Even more interesting is Interns work – and should be paid, lawyers warn ministers:

Thousands of unpaid interns could be entitled to compensation after government legal advice emerged suggesting employers are breaking the law by not following national minimum wage rules.

It is no surprise that someone with legal background sees the travesty of unfair internships, but it is quite pleasant to see the government’s lawyers acknowledge it.

All this activity in the UK is cause for optimism. Much the way that rock and roll then rap became respectable as their fans grew older, it is possible that as more victims of unfair internships get in position of power (including writing for The Guardian), the more crackdown there will be on the practice (cue in The times they are a-changin‘).

Interview with an employment lawyer

As evidence that law firms are starting to see the issue for what it is, Yasinski & Jones, LLP in Los Angeles, California, recently set up a website, InternshipLaw.com, to reach out to employers and interns. We hereby give the floor to John Carrigan, employment attorney with the firm, who answered our questions.

What gave you the idea to focus on this issue?
Having worked at several unpaid internships while I was in college, the issue has been in the back of my mind for years. Also, I practice in Los Angeles, which is home to a lot of unpaid internships in what you might call “glamour” industries like entertainment, public relations and fashion. A lot of these employers are very clear about expecting interns to perform real, substantive work for no pay, but no one seems to do much about it. I saw that as an interesting niche area for my practice.

What do you bring to it?
What I hope to bring to the issue is an ability to see the issue from both sides of the table, with a focus on the realities of the workplace. For instance, I try to look not at what “opportunities” an internship might present, but at what the interns are actually doing during their workday. Oftentimes, that may be something else altogether.

Do you think that employers are generally aware that unpaid internships are often illegal?
In my experience, most employers who improperly utilize unpaid interns don’t realize that they’re violating any laws in doing so. Many employers (and interns) believe, incorrectly under U.S. and California law, that there’s no obligation to pay an intern so long as he or she receives academic credit. Some other employers believe, also incorrectly under U.S. and California law, that they can get around an obligation to pay simply by getting a signed acknowledgement from the intern that the position will be unpaid.  

Why do you think that illegal internships are so common?
I think the biggest reason, at least in the U.S., would be that there’s been no real headline-grabbing case in which an employer was hit with substantial liability because they didn’t pay their interns. As a result, there’s a lack of familiarity with the law on both sides, and many interns have no idea they might even be entitled to pay, particularly where they’re receiving academic credit.

For those interns who do believe they’ve wrongly been denied pay, there is also the fear of retaliation. Interns tend to view their internships as a door into full-time employment in their chosen field, and a lot of them believe that filing any wage claim, or even simply asking to be paid, would mean they’d be somehow blackballed from an entire industry. Personally, I think that fear is vastly overstated. 

Is it difficult for you to convince employers that their internship program may be illegal?
Rather than describing a program as “illegal,” I’d be more likely just to explain that, based on the program as it is currently structured, there is a legal obligation to pay the interns. Under both U.S. and California law, in order for an internship for a for-profit employer to be unpaid, the employer has to satisfy six specific criteria, one of which is that the employer does not receive any “immediate advantage” from the interns’ work. Frankly, it is very rare that an intern’s work would not provide such an advantage to a for-profit employer, and most employers understand this once they take a look at the decisions interpreting the law.

Do you find that the courts understand the issue?
I think that they would, but very few of these cases go all the way to trial. Instead, the vast majority of wage claims are resolved out of court, generally for amounts that are kept confidential. 

Any interesting cases that you could share?
An opinion came out in California last year [NDLR: see LACBA, July-August 2011 (PDF)] regarding an internship program organized by a non-profit group called Year-Up, Inc.. Year-Up placed interns in short-term positions with for-profit employers as part of a curriculum meant to provide the interns with technical skills.  Although the interns were not paid a minimum wage, the employers actually paid more than $22,000 per intern to Year-Up to sponsor the program. The opinion concluded that interns involved in that program did not have to be paid because each of the six factors had been satisfied, but its discussion highlights just how many hoops a California employer must jump through in order to lawfully utilize unpaid interns.  As a result, from an employer’s perspective, it will often be more efficient just to pay interns the minimum wage rather than go through the hassle of establishing an unpaid internship program that complies with the law.

Five years too many…

This blog turns five today. Sigh. Much like its fourth birthday, it is no reason to celebrate. Through those years, the financial crisis seems to have worsen the situation for interns, as employers try to squeeze costs by avoiding to pay their contributing staff. At the same time, there has been a flurry of activity, including a recent book, Intern Nation, and the creation of several blogs, campaigns in the UK especially, and an increased awareness of the problem. At this point it is not clear what will happen next, but one thing is sure: it is not time to fold.

As the quick advice box on the right says, this should be seen more as a website than a blog. It is not meant to follow the news, but to provide resources for interns and food for thought for employers. Use the links at the top to browse the content. And feel free to send suggestions.

Unpaid interns: working for free

We went from lukewarm to cold on internships-for-credits, but it looks like it has gotten worse out there. Not only are colleges playing along, advertising unfair internships and making up programs with credits for internships without pay, but now they have started managing the expectations of graduates and legitimize what is an illegal and unfair practice. From the Globe and Mail, this quote from a student at Sheridan College:

“That was something [professors] stressed really hard – that we would not get paid”

Wait, there’s more, from another student:

“Humber is holding my diploma up in the air and saying we’re not giving it to you till you do this.”

At least, one law professor from York sees through it:

“My sense is that many employers believe simply calling someone an ‘intern’ relieves them of all employment obligations”.

Exactly. Ask them a simply question: why do you call it an “internship”?

 

Unpaid Interns, Complicit Colleges

Ross Perlin wrote an op-ed in the New York Times to denounce the complicity of US colleges in encouraging the practice of unfair internships. I have few problems with the argument since it is indeed scandalous that anyone should support such an unfair practice (except Fox Business that hilariously suggests to use those parental connections!).

The op-ed made it to the top of the most emailed articles from the New York Times and has inspired a few reactions on the web. I chose to respond to a blog post by Marc F. Bellemare, Assistant Professor of Public Policy and Economics at Duke University, where he argues that Ross Perlin’s “crusade” is misguided. You probably better have a look at his argument first if you want to understand my response.

You deserve praise for attracting some more attention to the issue raised by Ross Perlin in his op-ed, but I’m afraid that you did not make a convincing argument against his case.

You’re right to point at the group think fallacy in Ross’ (pointless) argument about the perceived political bent of US colleges. This makes it all the more disappointing that you should try to justify the practice because it dates back to the Middle Ages. Are there many other practices that you would like to justify on that basis? Following your own link, it is called a traditional wisdom fallacy.

You rightly point that new entrants on the job market contribute less and deserve a lower pay, but you overestimate the cost. The system of pay raises already takes into account the fact that a less experienced employee is likely to contribute less and hence is paid less. Are you suggesting that new entrants contribute zero to their employer? That they are paid for their experience rather than their contribution to a company? Are you suggesting that certain unions are right to put seniority ahead of performance?

Also, you would be right to suggest that it would be ridiculous to ban unpaid internships (“(…) banning unpaid internships, as Mr. Perlin suggests, is still not the way to go.”) but Ross never suggests this. He rather says that the practice has long exceeded the limits of the Fair Labor Standards Act of 1947 and that credits are a fig leaf for an exploitative practice.  Here, you commit a “straw man fallacy” by attributing him an easily refuted argument.

The problem is “unfair internships” whereby an entry-level employee goes without pay just because it is slapped with the title “intern” — regardless of its actual responsibilities, obligations and contribution. Long live the unpaid internships whereby an intern receives proper supervision and training. But this is not what Ross Perlin has witnessed and is reporting upon. In fact, he says that unpaid internships are just fine “if the college plays a central role in securing the internship and making it a substantive academic experience.” He is criticizing the rise of an unfair practice whereby employers take advantage of a weak segment of the workforce, now with the complicity of colleges.

Later, you say: “To see why, suppose we were to ban unpaid internships starting this year. Once employers have to pay for their interns, there will be a considerable drop in the number of internships are available. That is the direct effect of a ban on unpaid internships.” May that happen sooner than later. The existence of a practice and even its benefits does not justify it if the costs are greater. Should we lift speed limits, we’ll gain time and excitement at the price of safety and efficiency, so we don’t. But to revert to economics, what we have here is a collective action problem and it is the reason why it’s regulated against. The new entrants on the job market have little bargaining power, since they don’t yet belong to a collective bargaining arrangement and compete against each other, nor do they have a “signal” from the job market to prove their worth. The reason why unfair internships are already illegal (cf. FLSA, 1947) is to avoid this race to the bottom where workers are forced to give up even their pay to enter the job market, or have started to pay to work, as Ross demonstrates. When no one can do it, the playing field is leveled and no paid jobs are lost. Some may even be created as these companies would hire entry-level staff to perform those same tasks, stripped of their capacity to exploit the oversupply of labor.

Lastly, two quibbles. (1) You are right that taking an unfair internship is a form of signaling. I don’t see how it justifies it. You are descriptive, but stop short of making an argument to defend the practice. Unless you are concerned for employers who won’t be able to discern from GPA, extracurricular activities, interviews and tests which are the valuable candidates? (2) Your concern at the thought that we will create a generational rift if we enforce the ban on unfair internships (again, there is no ban on unpaid internships and Ross is not suggesting one) is very noble, but a bit thin. You correctly point to a path dependency problem. Are we stuck with this unfair and illegal practice just because we started? Is it clear that the new cohorts will lose more from missing on exploitative work experience than they would from having a fairer job market welcome them?

The “crusade” (the straw man, again!) is one for law enforcement to correct an unfair situation whereby the weak are exploited. The complicity of colleges deserves to be denounced, as Ross did.