For this test, the courts examine a non-exhaustive series of reflections to see if an internship can be unpaid, which are: a majority of states follow the test established by the U.S. Department of Labor: the examination of economic reality. This test set out six standards that must be met for an unpaid internship. If the internship contract is not an employment contract, but an internship allowance, the internship contract is qualified as a fictitious employment relationship (tax and social security). This means that the intern who receives an internship allowance must be included in the payslip, because in this case, the company must also deduct income tax, national insurance contributions and employer contributions under the Health Insurance Act2 from the internship allowance.2 3 If you are willing to hire an intern, look at these TheLawTog resources that can be modified for internships based on the scope of their duties: the choice between a paid or unpaid internship is yours. You just need to know if an internship is the right one for your business and, if so, whether your internship should be paid or unpaid. The twins refused to pay interns to their label The Row. Former interns said they were forced to work 50 hours a week and do the same work as paid employees without having to receive a cheque. At the end of the day, you are the only one who can decide what is best for your company and for your potential new interns. Internships are generally a good way for employers to pass on their knowledge and trainees to learn new skills. You just need to make sure that all the internships you offer are right for your business.
If you decide that an internship benefits your company, the next step is to decide whether you are offering an unpaid or paid internship. It is important to choose carefully to avoid future legal problems. In recent years, internships have grown in popularity… and, therefore, the number of unpaid internal complaints. There is a middle ground between an unpaid internship and a paid internship: to avoid internship contracts being considered as much as possible as employment contracts, best practices can be followed: in fact, unpaid internships focus on skills that can be used in different employment settings, while paid internships focus on certain skills that can be used in your company.