This week marked a significant moment in the national effort to classify interns as employees. The Department of Labor’s six-point test (issued in 2010) has been referenced in the courts to determine if an intern should qualify as an employee under the Fair Labor Standards Act (FLSA). This test was also used in a suit filed in February 2012 by Xuedan “Diana” Wang against Hearst Corp. In the lawsuit, Ms. Wang claims that as an unpaid intern at Harper’s Bazaar magazine, she frequently worked over 40 hours a week. U.S. District Judge Harold Baer denied a class certification for this lawsuit and rejected the interns’ bid for summary judgment on their status as “employees” under the FLSA and New York Labor Law. The interns appealed this denial and in November 2013, the Second Circuit gave them the go-ahead to pursue their appeal.
On April 8, 2014 the DOL filed an amicus brief in the Court of Appeals in support of the Hearst interns, stating that Judge Baer applied the wrong test to determine if the interns should be qualified as “employees” under labor law. This is the first instance where the DOL took a public stance since issuing the six-point test, and since the start of the wave of lawsuits brought forth by interns. The brief stated:
“Instead of utilizing the department’s long-standing, objective test, the district court adopted a more subjective ‘totality of the circumstances’ test that necessarily makes it more difficult for both employers and interns, as well as courts, to determine whether interns are employees entitled to the protections of the FLSA”
It goes on to encourage the Appeals Court to adopt the strict six-point test:
“[T]he Department’s test stands in stark contrast to a “totality of the circumstances” or “primary benefit” test, which would introduce subjectivity into the analysis and invite inconsistent results.”
The brief also directly references the current widespread practice on unpaid internship programs and its direct link to the inherent difficulties to entering the job market today:
“The Department’s test is also an important backstop to ensure that this very limited trainee exception to the FLSA’s broad coverage is not unduly expanded, particularly in difficult economic times when employers are eliminating paid staff positions and the promise of free labor is both tempting and available.”
“Nothing in the FLSA or in Portland Terminal suggests that for-profit employers should be permitted to circumvent their obligation to compensate individuals who are performing productive work by categorizing entry-level or temporary workers as interns or trainees. In fact, the Supreme Court made the opposite observation in Portland Terminal, stating that it is “[w]ithout doubt the [FLSA] covers trainees, beginners, apprentices, or learners if they are employed to work for an employer for compensation.” Portland Terminal, 330 U.S. at 151 (citing 29 U.S.C. 214(a)). Thus, the Department’s test excludes from the protections of the FLSA only those trainees or interns who are receiving bona fide training that is for their own benefit, and who receive the training under such close supervision that their efforts do not provide the employer with the productive work that it receives from its regular employees.”