Co-op and Intern Exemption Status

Last Updated on November 28, 2017 / Benefits & Compensation

Question:

We would like to add a co-op student to our staff this year. Are Co-ops and Interns considered exempt or non-exempt? How do you determine this?

Answer:

According to the Department of Labor (DOL), it appears that interns who work in for-profit companies in the private sector are typically considered non-exempt: http://www.dol.gov/whd/regs/compliance/whdfs71.htm.

However, whether or not student interns are covered under the Fair Labor Standards Act (FSLA) depends on the circumstances of the activities. If the work activity that the intern is to perform is an extension of the student’s academic programs, then the student might not be considered an employee.

To help determine if a student’s work is an extension of their academic program, these six criteria must be met:

1.     The training, even though it includes actual operation of the facilities of the employer, is similar to that which would be given in a vocational school;

2.     The training is for the benefit of the trainee;

3.     The trainees do not displace regular employees, but work under close observation;

4.     The employer that provides the training derives no immediate advantage from the activities of the trainees and on occasion the employer’s operations may actually be impeded;

5.     The trainees are not necessarily entitled to a job at the completion of the training period; and

6.     The employer and the trainee understand that the trainees are not entitled to wages for the time spent in training.

If all six of these criteria are met, the intern may not be considered an employee to the employer requiring compliance with FLSA or even pay. For more details, visit http://www.dol.gov/whd/regs/compliance/whdfs71.htm.

It’s tough having to navigate the ever-changing FLSA laws and other federally mandated rules and regulations. Strategic HR can help. Ask us for assistance with any of your benefits and compensation needs. Please visit our Benefits & Compensation page for more information on any of these services.