Hiring Summer Interns

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The beginning of summer always gives us something to look forward to and plan for: a beach vacation, an office outing to a ball game, or finding creative ways to avoid the ridiculous heat. But if you are the founder or a team member of a startup, one other thing you should prepare for is the beginning of Intern Season.

Now that school’s out for the summer, many students and recent graduates are looking for opportunities to gain valuable work experience, and many employers are looking to bolster their ranks for a few months without incurring high costs.

Whether you have already hired your interns or are still in the process of searching for the perfect candidates, it’s crucial that you take the time to consider some of the legal requirements and challenges involved in hiring interns.

At the outset, you should decide whether you are going to make your startup’s internship program paid or unpaid. If your budget allows, you can never go wrong with paying your interns at least the minimum wage. If, however, you decide to hire unpaid interns, you must follow a set of guidelines and refrain from looking at this as simply getting some “free labor” for the office.

As a general rule, every individual who performs work is considered an employee and must be compensated for his or her work. In the private for-profit sector, interns and trainees can be seen as an exception to this general rule. However, for this exception to apply (meaning: to avoid having to pay your intern), a rigid set of criteria must first be met.

The U.S. Department of Labor Wage and Hour Division has issued a fact sheet on what it takes for an unpaid internship program to comply with the Fair Labor Standards Act. At a minimum, you should carefully review this information to ensure that you meet the right criteria when determining whether you could offer an unpaid internship.

According to the fact sheet, the internship program should be “for the benefit of the intern” and should be “similar to training which would be given in an educational environment.” Both parties should agree that no wages will be paid, and that there is not necessarily a job waiting at the end of the internship.

In addition, employers should not use interns to “displace regular employees” and should work “under close supervision of existing staff.”

As you can probably tell by now, creating an unpaid internship program that doesn’t run afoul of the law can be challenging. While every startup is different and each program should be tailored to the startup’s business and culture, there are a few things every startup should do to make sure unpaid internships are properly offered.

  1. Make it a learning experience. Create an actual internship program that is structured around a classroom or academic experience. Prepare a syllabus and make the experience as structured and educational as possible for the intern.
  2. Give them meaningful tasks. Make sure that the benefits to the intern aren’t simply incidental to working in the office, but rather, are a result of an internship program intentionally structured to benefit the intern.
  3. Show them how your staff works. Provide your intern with regular shadowing opportunities. Avoid hiring interns as substitutes for regular workers or to augment your existing workforce during specific time period. Remember that bringing on unpaid interns for the purpose of avoiding the need to hire someone else to do the same task is never okay.
  4. Ensure it benefits the intern. Structure your internship program in a way that doesn’t provide you with an immediate advantage or benefit. Rather, the benefit should flow to the interns.
  5. Set a fixed period of time. Don’t use an internship merely as a trial period for the intern before hiring, and don’t make promises to hire at the end of the internships.

Good internship programs are undoubtedly beneficial and valuable, and it’s well worth the effort for startups to create structured programs that guarantee the success of its interns. And remember: interns who have a positive experience at a startup looking to build the next big thing can go on to make great contributions as entrepreneurs and startup founders themselves, further enriching this exciting ecosystem.


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