The Floodgates have Opened: Unpaid Internship Suits on the Rise
Don’t say we didn’t warn you. Last month we discussed the first suit filed by unpaid interns against their “employers” under the Fair Labor Standards Act. Channeling our inner Miss Cleo, we suggested at the time that the decision in Glatt v. Fox Searchlight Pictures, Inc., would have far-ranging implications on the EPL community. Sure enough, the floodgates have opened for unpaid interns seeking repayment under the FLSA.
In recent weeks, Conde Nast, Gawker, Warner Music, Nickelodeon, and others were sued for allegedly violating the FLSA for failing to pay minimum wage to interns. Most recently, NBC Universal is the target. The suit filed on behalf of unpaid interns who worked for high-profile shows including Saturday Night Live is similar to the Glatt v. Fox suit. The plaintiffs cite specifically to the prior decision and claim similar violations of the FLSA and New York Labor Law for NBC’s alleged failure to pay fair wages and provide certain employee benefits. The plaintiffs allege that NBC Universal improperly classified the plaintiffs as unpaid or underpaid interns thereby denying them benefits.
The key in these suits will likely be whether the positions satisfy the six criteria set forth in a Department of Labor fact sheet to determine when an internship may be unpaid. In Glatt v. Fox, the court concluded that the plaintiffs could not be considered unpaid interns because their work provided immediate value to Fox.
The Glatt v. Fox case has paved the way for a new class of litigation involving unpaid interns. All professionals who retain interns to supplement their workforce now face increased risk of liability. Employers should take stock of their intern programs and examine whether it provides an educational component. As we pointed out in our previous post, unpaid internships that are not accompanied by a bona fide training program could place firms and other organizations at increased risk of suit.