“It’s not what you know; it’s who you know.” Today’s college and graduate school students seeking employment opportunities in a difficult job market would probably agree with this maxim. Historically, students and graduates have used internship programs as opportunities to gain experience in a particular industry in the hope of establishing a career or finding permanent employment. Internships are often viewed as a rite of passage, the benefits of which are obvious to those who seek them and include: (i) on-the-job training that cannot be taught in an academic setting; (ii) networking opportunities with professionals who are established in the industry; and (iii) an opportunity to observe and experience the day-to-day operations of a particular profession, industry or trade.

It should come as no surprise that some of the most respected and highly successful people in this country began their careers as interns in their respective professions. By way of example, National Football League commissioner Roger Goodell started as an intern for the NFL after graduating from college in 1981; Steven Spielberg began his career in the film industry as intern for Universal Studios at the age of 17; Sean “Diddy” Combs began his career in the music industry as an intern for Uptown Records; and Oprah Winfrey interned for a local CBS affiliate during her sophomore year at Tennessee State University. Well-publicized lawsuits against companies like NBC Universal, Condé Nast and Sony over the past few years, however, have caused many employers to reevaluate whether to make use of an unpaid internship program.

Perhaps motivated by a slow economy and sluggish job market, many groups of unpaid interns have filed class action lawsuits in which they claim that, under federal and state wage and hour laws, they were actually (and should have been treated as) “employees,” and are thus owed the minimum wage and in some instances overtime for all the hours during which they served as interns. Counsel who file lawsuits for classes of interns—and who, in addition to recovery for their clients, typically seek attorneys’ fees and costs—have been fueled by inconsistent and unclear legal standards for private sector interns. For example, the U.S. Court of Appeals for the Second Circuit has recognized the inconsistent approach taken by district courts and soon will hear an appeal on two class certification decisions involving former unpaid interns at Fox Entertainment Inc. and Hearst Corporation. In so doing, the Second Circuit is expected to clarify the proper standard through which to determine whether interns qualify as “employees” under the applicable wage and hour laws.

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In conclusion, until such time (if ever) as the Second Circuit—and potentially other appellate courts—recapture the premise and experiential value of unpaid internships to countless graduates embarking on important career paths, for-profit employers should think long and hard prior to implementing an internship program that does not compensate its interns for their time at minimum-wage rates at the very least.

Read more: www.corpcounsel.com/id=1202664839230/Where-Have-All-the-Unpaid-Internships-Gone#ixzz38nDIp5F1

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