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Are Unpaid Internships Allowed In California?

Summer is right around the corner and many college students may be searching for meaningful work experience in their chosen fields to fill the next three months and earn additional cash for the next school year. But, with the job market still reeling from the economic downturn, more and more companies are offering unpaid internships.

The benefits seem obvious. The student or intern gets real-life work experience that he or she can add to a resume and even a foot in the door toward permanent employment. The employer gets a long term on-the-job interview to evaluate the potential new hire's fit with the company without the added expense of another person on the payroll. But is this legal? Do unpaid internships run afoul of wage and hour requirements?

The Federal Labor Department developed standards for unpaid internships in 2010, among them:

  • The intern must receive educational training
  • The intern cannot take the place of another or other paid workers
  • The intern cannot be guaranteed a job at the end of the unpaid experience
  • The employer cannot receive any immediate benefit from the intern's work

A recent study by the National Association of Colleges and Employers revealed that less than half of unpaid internships turn into full time positions after graduation. There are also concerns as to whether unpaid internships are simply exploiting college students who are facing a historically difficult job market.

Unpaid interns should be aware of their rights. It's unlikely that a company will be investigated for violating wage and hour provisions if it does not meet the standards laid out by the Department of Labor unless the intern reports the bad acts him or herself.

Source: San Francisco Chronicle, "The Ethics And Economics Of Unpaid Internships," Angie Mohr, May 30, 2012

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