Unpaid interns have long been a questionable group from a wage and hour risk perspective. In Schumann v. Collier Anesthesia, P.A., No. 14-13169 (11th Cir. 2015), the Eleventh Circuit joined the Second and Sixth Circuits in setting aside the “antiquated” Department of Labor six-factor internship analysis in favor of a more stringent “primary beneficiary” test.
In Schumann, 25 unpaid student registered nurse anesthetists participated in a clinical program in pursuit of their master’s degree. They sued for wages and overtime under the FLSA for their clinical hours. They lost on summary judgment when the trial court used the DOL’s six factor test to determine that the students were not employees within the meaning of the FLSA. The Eleventh Circuit reversed, holding that “[l]onger-term, intensive modern internships that are required to obtain academic degrees and professional certification and licensure in a field are just too different” from the typical internship program to rely upon the same analysis. Instead, the seven-factor approach articulated by the Second Circuit in Glatt v. Fox Searchlight Pictures, Inc. 791 F.3d 375 (2d Cir. 2015), should govern. This “flexible” test focuses on who receives the primary benefit of the relationship. If the employer, the intern is an employee and must be paid. If the employee, the internship can be unpaid. Those seven factors are:
- Whether the intern and employer understand there is no expectation of pay;
- Whether the internship provides similar training to what would occur in an educational institution;
- Whether the internship is connected to the intern’s formal education program by coursework or course credit;
- Whether the internship accommodates the internship’s academic commitments by matching up to the academic calendar;
- Whether the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning;
- Whether the intern ‘s work complements or displaces the work of paid employees, while providing significant educational benefits to the intern; and
- Whether the intern and employer understand that there is no entitlement to a paid job at the end of the internship.
The analysis is not all or nothing, and an intern can be a bona fide intern for part of the internship, while an employee at other times. Ultimately, the Schumann court did not decide or even remark on whether the interns were actually interns or employees under this analysis; instead remanding the case to the trial court for resolution of that issue.