Programs Under The Fair Labor Standards
The FLSA requires "for-profit" employers to pay employees for their
work. Interns and students, however, may not be "employees" under
the FLSA-in which case the FLSA does not require compensation for
Courts have used the "primary beneficiary test" to
determine whether an intern or student is, in fact, an employee
under the FLSA.2 In short, this test allows courts to examine
the "economic reality" of the intern-employer relationship to
determine which party is the "primary beneficiary" of the
relationship. Courts have identified the following seven factors as
part of the test:
1、The extent to which the intern and the employer clearly
understand that there is no expectation of compensation. Any
promise of compensation, express or implied, suggests that the
intern is an employee-and vice versa.
2、The extent to which the internship provides training
that would be similar to that which would be given in an
educational environment, including the clinical and other hands-on
training provided by educational institutions.
3、The extent to which the internship is tied to the
intern's formal education program by integrated coursework or the
receipt of academic credit.
4、The extent to which the internship accommodates the
intern's academic commitments by corresponding to the academic
5、The extent to which the internship's duration is limited
to the period in which the internship provides the intern with
6、The extent to which the intern's work complements,
rather than displaces, the work of paid employees while providing
significant educational benefits to the intern.
7、The extent to which the intern and the employer
understand that the internship is conducted without entitlement to
a paid job at the conclusion of the internship.
Courts have described the "primary beneficiary
test" as a flexible test, and no single factor is
determinative. Accordingly, whether an intern or student is an
employee under the FLSA necessarily depends on the unique
circumstances of each case.
If analysis of these circumstances reveals that an intern
or student is actually an employee, then he or she is entitled to
both minimum wage and overtime pay under the FLSA. On the other
hand, if the analysis confirms that the intern or student is not an
employee, then he or she is not entitled to either minimum wage or
overtime pay under the FLSA.