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Unpaid Internships 101: California Unpaid Internship Standards and Regulations

Posted by attorney Justin Lowenthal

There is no state statute or regulation in California which expressly exempts persons participating in an internship from the minimum wage and overtime requirements. Federal regulation provides that those who “employ", meaning “suffer or permit to work", must compensate workers for the services they perform for an employer. Therefore, internships in the “for-profit" private sector will generally be viewed as employment, which could create maddening expense or liability for employers who have unpaid interns. While state law is somewhat unclear, the Division of Labor Standards Enforcement (DLSE) has historically followed federal interpretations which recognize the special status of trainees and interns who perform some work as part of an educational or vocational program. Accordingly, the federal Department of Labor (DOL) has articulated six criteria, derived from the Supreme Court’s Portland Terminal case, to be applied to determine whether a “trainee" is exempt from the Fair Labor Standards Act (FLSA). The determination of whether an internship or training program meets this exclusion depends upon all of the facts and circumstances of each such program. The following six criteria must be applied when making this determination:

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