Thinking About Offering Unpaid Internships?

As BusinessWeek reports, the rapid growth of unpaid internships by for-profit employers in the United States is driving regulators, universities, and students to question whether the internships are legal.

Unpaid internships seem like a win-win in this economy. With college hiring and recruiting budgets down, employers get to maintain their employment brand on campus and their pipeline of student talent. Meanwhile, with fewer jobs out there for college graduates, students get the opportunity to jumpstart their careers.

Yet, the U.S. Department of Labor warns there are very few instances where a for-profit employer can offer an unpaid internship. Every unpaid internship must meet six criteria to escape legal penalty. For instance, the internship must be similar to training given by an academic institution, and the employer can derive no immediate advantage from the intern.

As Roundtable members know, we recommend employers use internships as realistic job previews for students. Consider making pay part of that job preview if you don’t already do so.