Unpaid internships have come under heavy scrutiny in recent years. In fact, many high school students, college students, and recent graduates who have accepted unpaid internships have successfully brought suit against their employers with courts around the country determining they were entitled to be paid minimum wages and overtime wages in accordance with the Fair Labor Standards Act (“FLSA”).
In Brown v. New York City Department of Education, the United States Court of Appeals for the Second Circuit took up the case of a volunteer intern (Jayquan Brown) who performed work for the New York City Department of Education’s Banana Kelly school from the Fall of 2007 through December 2010. According to the record, Mr. Brown typically worked 40 hours per week during the school year and he also assisted with the summer session. The only compensation Mr. Brown received were fewer than five cash payments of $40-$50, $60 per week on 10-20 occasions, and occasional public transportation cards.
In analyzing Mr. Brown’s case, the Second Circuit first determined that the issue of whether an individual qualifies as a public agency volunteer exempt from the minimum and overtime wage requirements of the FLSA or instead is an employee subject to the FLSA is a question of law for the courts to decide as opposed to being a question of fact for the trier of fact (often a jury) to decide. The court then set forth three factors for assessing the public agency volunteer/employee issue:
- A public agency counter must be motivated by “civic, charitable or humanitarian reasons,” although such motivations do not have to be singular.
- From the totality of circumstances, the economic (and other) factors most relevant to the issue, including whether a person alleged to have been a public agency volunteer was promised, reasonable expected, or received compensation, must be assessed.
- An objective (not subjective) standard should be applied to determine whether a person’s expectation of compensation is reasonable.
Using the foregoing factors, the court determined Mr. Brown was a public agency volunteer and, therefore, exempt from coverage under the FLSA because he “was significantly motivated by civic, charitable, or humanitarian reasons in providing his services, at the same time that he acted for other personal reasons,” there was no “promise, expectation, or receipt of compensation within the meaning of the FLSA,” and the services he provided were done “freely and without coercion.”
These cases are highly dependent on the facts of a particular situation so while Mr. Brown was deemed to not be entitled to minimum and overtime wages under the FLSA, other individuals working in unpaid internships for public agencies may very well be entitled to receive minimum and overtime wages if they are able to demonstrate a more reasonable expectation of compensation for the work they performed.