NYT: Growth of Unpaid Internships May Be Illegal, Officials Say

The New York Times published an important article about unfair internships last week-end. Important because it takes the right perspective – they are likely illegal and unfair – and because this paper is influential (just look at some immediate coverage). Important also because the public is eager to hear about this issue, as evidenced by the 2nd position in the list of the most emailed articles today – two days after it was published – and most emailed for the business section.


So, what’s in there? Mostly, some enlightenment from the mainstream media that millions of people are being exploited in the workplace. Good for the NYT. But what’s most interesting is the section about the Labor Departments finally taking action, at the state and federal levels.

The Labor Department says it is cracking down on firms that fail to pay interns properly and expanding efforts to educate companies, colleges and students on the law regarding internships.

About time. We will cover some of these cases soon. Also, there are some interesting statistics.

In 2008, the National Association of Colleges and Employers found that 83 percent of graduating students had held internships, up from 9 percent in 1992. This means hundreds of thousands of students hold internships each year; some experts estimate that one-fourth to one-half are unpaid.

It’s really too bad that it ends with the vague “some experts”. I’m not asking for a private eye report nor an academic quote, but the NYT ought to source better its statistics.

We speak often about the role of regulators, employers and interns to end this practice, but those who publicize internships – legitimizing the postings and increasing competition among interns for a given position, among other things – also have a constructive role to play. While some listing websites take a hands-off approach, washing their hands from their role for promoting an illegal and unfair practice, but others are not so shy.

“A few famous banks have called and said, ‘We’d like to do this,’ ” Ms. Steinfeld said. “I said, ‘No way. You will not list on this campus.’ ”

Sometimes, it’s so obvious that an employer is trying to take advantage of the system, one ought to refuse the listing. Actually, any listing website should commit to apply the FLSA rules, if only to remain legal.

The story also quotes a business lawyer that pleads in favor of her clients:

Camille A. Olson, a lawyer based in Chicago who represents many employers, said: “One criterion that is hard to meet and needs updating is that the intern not perform any work to the immediate advantage of the employer. In my experience, many employers agreed to hire interns because there is very strong mutual advantage to both the worker and the employer. There should be a mutual benefit test.”

Mutually beneficial arrangements are not illegal at all, they are even encouraged. They are called “jobs” and the are usually paid a legal wage. If the intern is “beneficial” to the company,it means that they are profitable and hence they are entitled to a paycheck. This is certainly not an age-old principle that we want to overturn.

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