This month marks the 75th anniversary of the US Fair Labor Standards Act of 1938, which set the first federal minimum wage, created overtime protections and the five-day workweek, and virtually ended child labor in the United States. We should celebrate its legacy by giving all young people paying jobs instead of worthless lines on their resumes.
Earlier this month, a federal district court judge ruled in Glatt v. Fox Searchlight Pictures, Inc. that a for-profit corporation like Fox Searchlight cannot escape its obligation to pay the minimum wage by calling its employees “interns.” This is a big deal, given that thousands of employers, especially in the arts, journalism and fashion industries (but spreading lately to law firms, public relations firms and even manufacturing) have grown accustomed to free labor from their entry-level workforce. Greatly reduced government enforcement resources and a laissez-faire business culture have eroded respect for our labor laws. The Fox Searchlight decision says, “Enough is enough.”
A popular defense employers have constructed is that internships are for the benefit of the intern as an educational experience and, therefore, do not solely benefit the employer, if the employee is receiving college credit while she works. The judge in Glatt v. Fox Searchlight Pictures, Inc., William Pauley, held that this argument is invalid—the fact that a student is paying tuition to a school and receiving college credit has nothing to do with the employer’s obligation to pay its employees. And of course, Judge Pauley is right. If the employer paid the student’s tuition bills, that would be one thing. But an intern who works without pay and also pays a tuition bill is even worse off financially than an intern who is merely unpaid. What’s more, there is evidence that unpaid interns hurt themselves in the labor market, perhaps by signaling that their work can be gotten cheaply.
This decision and the settlement of a similar suit against TV anchor Charlie Rose are the first prominent cases to make use of the US Department of Labor’s recent restatement of the 60-year-old rules regarding internships and training situations. Fact Sheet #71, published three years ago, sets out strict criteria that must be met before an employer can legally put someone to work without paying at least the minimum wage. The six factors that must be considered include whether the internship is structured like vocational education, whether the intern does work a regular employee would normally do, and whether the employer gets an immediate advantage from the work.
Employer attorney Camille Olson, Intern Nation author Ross Perlin, and other worker advocates all agree with Nancy J. Leppink, the former head of the Department of Labor’s Wage and Hour Division, who says valid, legal unpaid internships in the for-profit sector are rare: “If you’re a for-profit employer or you want to pursue an internship with a for-profit employer, there aren’t going to be many circumstances where you can have an internship and not be paid and still be in compliance with the law.” Most internships can’t meet the basic test of being established for the benefit of the intern. They can’t because they’re not education, they’re just jobs—the type of entry-level jobs that used to be paid the minimum wage and sometimes much more.
I’m happy to see the wave of lawsuits building over this exploitation of young workers, and I hope it’s joined by another wave—of enforcement by federal and state agencies. The little bit of enforcement via individual suits has already made a difference. Lawyers are telling their clients to be wary of hiring unpaid interns; companies are switching to paid internships. Al Jazeera’s US operations, for example, ended its unpaid internships a couple of weeks before the Fox Searchlight decision was handed down, and an intern rights movement like the one in England seems to be growing. But the government has the resources to make a powerful difference, and a few high-profile cases against news organizations and fashion houses would get everyone’s attention.
Because unpaid internships in government are not illegal, they are widespread. But they are still morally questionable, both because they undermine the private sector’s respect for the law and because they discriminate against disadvantaged families. If, as the common wisdom tells us, the best way to get hired by a legislator or a government agency is to have previous unpaid internship experience, then students from working-class or lower-middle-class families will be excluded from desirable government jobs. They can’t afford to live away from home in Washington, DC, or their state capital, paying for food and rent while working unpaid. Many are having so much trouble handling thousands of dollars of student debt that working without pay is unthinkable.
Congresswoman Suzanne Bonamici, a Democrat from Oregon, is preparing federal legislation to fund stipends for young people who otherwise could not afford to take government or non-profit internships. That idea, first put forward by Kathryn Edwards and Alexander Hertel, makes sense as economic stimulus, as a way to equalize opportunity, and as a way to ensure that government, in particular, gets input from every economic class, and not just the elite. The Obama administration proposed a similar program in the private sector as part of its fiscal year 2013 budget.
Those who defend unpaid internships as simply giving young people work experience, or a chance to prove their value in a work environment, are kidding themselves, even as they sell those young workers short. Getting free work from employees is no less wrong and exploitative today than it was 50 years ago. The only differences between entry-level jobs today and those of 50 years ago are that the young workers are (contrary to myth) much better educated, more skilled and more productive than young workers were then—and that the minimum wage is a much smaller share of average wages. The average 20-year-old can do things with a computer that most bosses can only envy, and her math and research skills are better than her parents’ were at the same age. She deserves to be paid and has the right to be paid. In fact, as the FLSA makes clear, everyone in America deserves to be paid.