Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
Don’t Get Schooled This Summer: Internship Compliance Tips
Author: Scarinci Hollenbeck, LLC
Date: June 18, 2015
Key Contacts
Back
As schools let out for summer, internship season is upon us. While internship programs can benefit both students and businesses, the failure to ensure compliance with state and federal laws can lead to costly legal headaches.
Compliance with the Fair Labor Standards Act (FLSA) is still important, but it is not the only compliance concern that employers must address. In the past few years, many states, including New York, have implemented additional legal protections.
As a reminder, with regard to wages, true unpaid internships are rare, given that compensation is generally required whenever the employer benefits from the work the intern performs. As previously discussed on the Scarinci Hollenbeck Business Law News Blog, the Department of Labor uses the following six-factor test to determine whether an intern can truly be unpaid:
- The training must contain a significant educational component;
- The training must primarily benefit the intern;
- The interns may not displace regular employees but work under the close supervision of existing staff;
- The company must not derive an immediate advantage from the intern’s activities;
- The intern should not necessarily be entitled to a job at the conclusion of the program; and
- There must be a clear understanding that the intern is not entitled to wages.
Even if interns are unpaid, they may be covered under certain employments laws. In New York, lawmakers amended the state’s Human Rights Law to protect interns from discriminatory practices with regard to hiring, discharge, or terms/conditions of employment. In response to high-profile court decision dismissing a case by an unpaid intern, the law also now expressly prohibits sexual harassment of interns by employers, codifying both the quid pro quo and hostile environment tests for sexual harassment.
In New Jersey, proposed legislation would amend the Law Against Discrimination, the Conscientious Employee Protection Act, and the Worker Freedom From Employer Intimidation Act to include unpaid interns. Accordingly, employers could be held liable for harassment, discrimination, intimidation, and retaliation against this new class of workers. The bill passed the Senate last year, but is not yet law.
- Practices: Public Employment Law, Labor & Employment
- Locations: Red Bank, NJ, Little Falls, NJ, New York City
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Why Compliance Monitoring Matters for NY and NJ Businesses
Compliance programs are no longer judged by how they look on paper, but by how they function in the real world. Compliance monitoring is the ongoing process of reviewing, testing, and evaluating whether policies, procedures, and controls are being followed—and whether they are actually working. What Is Compliance Monitoring? In today’s heightened regulatory environment, compliance […]
Author: Dan Brecher
When Are New Jersey Business Owners Personally Liable for Corporate Debt?
New Jersey personal guaranty liability is a critical issue for business owners who regularly sign contracts on behalf of their companies. A recent New Jersey Supreme Court decision provides valuable guidance on when a business owner can be held personally responsible for a company’s debt. Under the Court’s decision in Extech Building Materials, Inc. v. […]
Author: Charles H. Friedrich
Commercial Real Estate Trends to Watch in 2026
Commercial real estate trends in 2026 are being shaped by shifting economic conditions, technological innovation, and evolving tenant demands. As the market adjusts to changing interest rates, capital flows, and workplace models, investors, owners, tenants, and developers must understand how these trends are influencing opportunities and risk in the year ahead. Overall Outlook for Commercial […]
Author: Michael J. Willner
One Big Beautiful Bill: New Tip Income Tax Rules Employers & Workers Need to Know
Part 2 – Tips Excluded from Income Certain employees and independent contractors may be eligible to deduct tips from their income for tax years 2025 through 2028 under provisions included in the One Big Beautiful Bill. The deduction is capped at $25,000 per year and begins to phase out at $150,000 of modified adjusted gross […]
Author: Scott H. Novak
One Big Beautiful Bill: New Overtime Tax Rules Employers and Employees Need to Know
Part 1 – Overtime Pay and Income Tax Treatment Overview This Firm Insights post summarizes one provision of the “One Big Beautiful Bill” related to the tax treatment of overtime compensation and related employer wage reporting obligations. Overtime Pay and Employee Tax Treatment The Fair Labor Standards Act (FLSA) generally requires that overtime be paid […]
Author: Scott H. Novak
New York’s FAIR Business Practices Act: What the New Consumer Protection Measure Means for Your Business
In 2025, New York enacted one of the most consequential updates to its consumer protection framework in decades. The Fostering Affordability and Integrity through Reasonable Business Practices Act (FAIR Act) significantly expands the scope and strength of New York’s long-standing consumer protection statute, General Business Law § 349, and alters the compliance landscape for New York […]
Author: Dan Brecher
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.