Many businesses today offer college students the opportunity to hold a summer intern position. These can be rewarding for the college student as well as provide some help to the business. Offering paid or non-paid internships can create risk for your business. We wanted to highlight some of the business risks associated with having interns. Before you bring that person on board, make sure your business is well prepared.
You should have a written plan. It should include a job description, hours, and line of authority.
Check to see if there are any state regulations that might be impacted.
If you offer a paid internship, you will need to treat the intern like any other employee. We suggest having a formal agreement indemnifying the terms of the agreement, including the time period of the internship.
If the internship is a paid position, don’t forget about workers’ compensation.
Make sure you comply with Healthcare Reform relating to employee benefits.
Make sure the intern understands they are not entitled to “regular” company benefits, i.e. retirement, insurance, vacation, etc.
The internship must provide similar training that would be given in an educational environment.
There must be a “true” benefit for the intern.
The internship cannot be for the sole benefit of the company.
The intern must not replace regular employees, and should work under the close supervision of existing staff.
Unpaid internships for for-profit companies are subject to the U.S. Department of Labor’s Fair Labor Standards Act. There are provisions if you offer educational credit. Here is a link to the U.S. Department of Labor.
We recommend you check with the department of labor to make sure your program meets all of the requirements. There have been many businesses who have been sued as a result of improper internship programs.
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