An internship provides practical experience related to your professional field of interest, and an opportunity to develop academic knowledge, career skills, and new competencies within the ‘world of work’. Internships can be paid, unpaid, supervised, unsupervised, for or not for academic credit.
Since standardized internship guidelines do not exist for employers, educators, or students, NACE recommends the following definition to describe an internship (Position Statement: U.S. Internships, 2011):
An internship is a form of experiential learning that integrates knowledge and theory learned in the classroom with practical application and skills development in a professional setting. Internships give students the opportunity to gain valuable applied experience and make connections in professional fields they are considering for career paths, and give employers the opportunity to guide and evaluate talent.
General Internship Criteria
To determine if an internship opportunity meets the defined standards set forth by NACE, the following criteria must be met:
- The experience must be an extension of the classroom: a learning experience that provides for applying the knowledge gained in the classroom. It must not be simply to advance the operations of the employer or be the work that a regular employee would routinely perform.
- The skills or knowledge learned must be transferable to other employment settings.
- The experience has defined beginning and end, and a job description with desired qualifications.
- There are clearly defined learning objectives/goals related to the professional goals of the students’ academic coursework.
- There is supervision by a professional with expertise and educational and/or professional background in the field of experience.
- There is routine feedback by the experienced supervisor.
- There are resources, equipment, and facilities provided by the host employer that support learning objectives/goals.
An unpaid internship is an opportunity to gain professional experience within an industry of interest. Courts have described the “primary beneficiary test” (below) as a flexible test, and no single factor is determinative. Accordingly, whether an intern or student is an employee under the FLSA necessarily depends on the unique circumstances of each case. If analysis of these circumstances reveals that an intern or student is actually an employee, then he or she is
entitled to both minimum wage and overtime pay under the FLSA. On the other hand, if the analysis confirms that the intern or student is not an employee, then he or she is not entitled to either minimum wage or overtime pay under the FLSA. Unpaid internships for public sector and non-profit charitable organizations, where the intern volunteers without expectation of compensation, are generally permissible.
The Test for Unpaid Interns and Students
According to Fact Sheet #71 from the U.S. Department of Labor Wage and Hour Division
(Updated January 2018) Courts have used the “primary beneficiary test” to determine whether an intern or student is, in fact, an employee under the FLSA. In short, this test allows courts to examine the “economic reality” of the intern-employer relationship to determine which party is the “primary beneficiary” of the relationship. Courts have identified the following seven factors as part of the test:
- The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa.
- The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.
- The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.
- The extent to which the internship accommodates the intern’s academic commitments by
corresponding to the academic calendar.
- The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.
- The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.
- The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.
The Office of Career Education supports the following principles, stated in the Reasonable Offer Deadlines Guidelines Position Paper (2012) published by The National Association of Colleges and Employers (NACE).
- If offers are extended early in the campus recruiting cycle, the Committee recommends that employers (1) provide students a minimum of three weeks to decide and not require decisions earlier than six months prior to the candidate’s graduation; and (2) provide students the opportunity to request deadline extensions to allow a reasonable period for investigation of other recruiting opportunities for comparison. However, we recognize that the definitions of “sufficient time” and “reasonable period” will vary, given industry standards, a student’s prior experience with the employer, offer timing, and proximity to the graduation date / start time.
- Providing sufficient time for students to evaluate the employment opportunities offered to them allows them to make the wisest decisions for all concerned, creating a positive experience for candidates and employers, and ultimately reducing renege and attrition rates.
- We expect employers to honor all offers made to students and that no conditions will be placed on the offer (e.g., “You have by the end of the day to make a decision”, “We have 10 offers outstanding for 8 openings and will accept the first 8 students who get back to us,” etc.). No incentives may be offered to induce students to accept offers early (e.g., “We will provide a $5,000 bonus if you sign today,” etc.).
- An official offer from an employer should be in written format and contain the position title, salary, start date, and work location.