New Internship Guidelines—Who Needs to Get Paid?

Offering an internship is one of the best things a company can do—both for their own interest, as well as for the community at large. The intern benefits by receiving real-world work experience for their career and interests, and the business gets a helping hand. But sometimes, that line between intern and employee can get a little fuzzy.

 An internship can mean practical application of skills for a student and an extra set of extra hands for a business.

New rules to the Department of Labor are redefining what it actually means to be an intern. Are you running a safe internship program? Or are some things getting lost in the details? In order to protect the rights of the individuals working (or “interning”) at your company, it’s time to review the guidelines.

New Guidelines for Internships

The Fair Labor Standards Act requires “for profit” companies to pay employees for their work on the job, but the rules for interns can sometimes cause confusion. Fortunately, the latest Internship Program Fact Sheet helps clear the air. Updates as of January 2018 help business owners establish boundaries for their paid employees and un-paid interns. If your company wants to host interns, you’ll need to review the guidelines in their test. Here are some of the highlights:

  1. Both the employer and the intern need to understand that there is no expectation of compensation. Any sort of compensation, even implied, suggests that your intern might actually be an employee.
  2. Any training that your internship provides needs to be similar to what an intern would gain in an educational setting, or even linked to the intern’s formal teaching with academic coursework and credit.
  3. Since companies provide educational benefits to interns, your intern’s work should complement the work of your paid employees—not displace or replace their responsibilities.

Both the employer and the intern should understand that internships are offered and completed without any entitlement to a paid job offer.

Throughout the process, interns must also have continually access to a supervisor while at work. Employers should not leave interns alone in the office. Regular communication for progress reports and other feedback can help make the internship program a success for everyone involved.

Internships Benefit Both Sides

The guidelines for a fair and safe internship program help large companies and small business owners set standards and create a positive learning environment. Of course, navigating these steps can be a little more involved than some companies have been used to. Along the way, it helps to remember that having interns around the office is a great boost for your company as a whole. Your actual employees might feel more motivated with fresh faces in the office. So, while the program is set up to provide education and real-life training for interns, companies get huge benefits as well.

By sharing your workload with eager interns, you can help save your company money and make a big difference in a student’s life. Eliminating internship programs altogether could be a hard hit to any company. By embracing the changes and working to improve the standards set by your intern supervisors, your business can do its part to make the next generation stronger for a bright future.

For Other Help, Contact The Payroll Department

Your interns can help in just about any department of your company, but for the best service for your payroll and HR needs, it’s best to stick with the experts. The Payroll Department is proud to work with businesses large and small for the bookkeeping, accounting, and payroll needs.

If you need help determining where your company stands with the new internship guidelines, please don’t hesitate to give The Payroll Department a call at (317) 822-2568. Our experienced team will work with you to find the right setup for your full-time employees, part-time employees, and seasonal interns. Let our comprehensive services help your company stay on track for years and decades to come.


-Elaine of The Payroll Department Blog Team

Posted in: Operating a Small Business, Payroll

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