Turning to sources of free labor such as interns and volunteers may end up costing companies in a big way: lawsuits. Many former interns and volunteers claim they should have been listed as employees and therefore been entitled to payment.
"Defending these claims is often an expensive undertaking for employers because potential damages under the Fair Labor Standards Act include, among other things, back pay for up to two years or even three years for willful violations, liquidated damages which doubles the amount of unpaid back wages owed, and reasonable attorney’s fees and costs to the prevailing plaintiff," said Harley Storrings, a labor attorney and partner in the Miami office of Arnstein & Lehr LLP.
Storrings said that companies, however, can avoid a lawsuit by following some simple steps when dealing with interns:
- The intern should receive training similar to that which would be given in an educational environment.
- The intern should not displace regular employees.
- The intern should not necessarily be entitled to a job at the conclusion of the internship.
- The employer and the intern must both understand and agree that the intern is not entitled to wages for the time spent in the internship.
- The internship should primarily be for the benefit of the intern, not the employer. In fact, the internship may at times be a detriment to the employer.
Storrings offers the following advice on how employers should deal with volunteers:
- The services provided by the volunteer should be different from those performed by employees.
- Typically, the volunteer should not perform services full-time.
- The volunteer should be able to set his or her own schedule.
- The volunteer’s primary motivation should be related to his or her own personal charitable, religious, humanitarian or civic beliefs – not by the hope or expectation of eventually obtaining employment with your company.