Broker Check

Taking on Unpaid Interns: A Win-Win for your Business

| August 16, 2021

In response to a challenging economic climate, many businesses will trim their hiring budgets, even as large numbers of students, recent graduates, and other people with attractive qualifications are struggling to find work. For small businesses, taking on an intern can benefit both parties: The intern gains valuable work experience, and the company has the chance to utilize fresh talent, while getting help at little or no cost.

But, before your business decides to recruit interns, consider carefully your organization’s objectives and what tasks you can ask an unpaid intern to perform. While interns can be valuable contributors to the workplace, it is important to remember that they are not the equivalent of full-time employees, or even paid trainees or apprentices. Most interns take such positions for relatively short periods of time, usually between a few weeks to six months, and cannot be expected to perform or produce the same work as an experienced employee.

Generally, the U.S. Department of Labor (DOL) uses several criteria to distinguish between employees and interns. In an internship, students or recent graduates can expect to be given the opportunity to practically apply skills learned at school or college. If the individual receives training, it must be for his or her benefit, and not to generate revenue for the company. In most cases, interns should not be relied upon to perform rote tasks that are normally handled by lower-level employees, unless all of the company’s employees regularly perform these jobs. Further, the employer should be prepared to provide instruction and mentoring to the intern. This may not contribute to the operation of the business, however, and may even interfere with workflow, as managers and employees answer questions and demonstrate procedures.

By law, employers are not permitted to use intern programs primarily as a testing ground for new employees, and companies should not provide the promise of a job at the end of the internship period. When internships are unpaid, there must be an explicit understanding that the individual is entering into an internship in which no financial compensation is involved. To ensure that no misunderstanding about the arrangement arises, your organization can provide each prospective intern with a letter outlining the terms of the internship. Ask the intern to sign the letter and return it to your Human Resources department.

As long as these guidelines are observed, an intern can be a valuable contributor to your organization, especially if he or she brings certain skills, as well as enthusiasm and energy, to the workplace. Whenever possible, assign interns to work alongside experienced employees, taking on tasks as they are able, with the level of responsibility and the amount of assigned work gradually increasing. Ideally, the work will challenge the interns and encourage them to use their skills, without causing them to feel overwhelmed or frustrated.

Because they are still learning, interns may seek out regular feedback on their performance and guidance on how to correct or avoid mistakes. When assigning tasks, managers should consider the length of the internships and avoid involving interns in long-term projects.

Depending on your company’s needs and objectives, you may choose to take on several interns at once. While a group of interns may require more supervision, they can also be trained and mentored as a group, and assigned to work as a team.  

While internships are not intended to be “test runs” for employment, your company does have the option of making a job offer to an intern who has performed particularly well, either upon completion of the internship or after the intern has finished his or her education. If you are interested in taking on interns, your organization can post openings on internship listing websites or contact local schools and colleges that provide training relevant to your industry.