Unpaid Intern Lawsuits Show No Sign of Stopping

Another day, another round of unpaid interns’ allegations of foul play. This summer’s lawsuit du jour, the sudden rise of lawsuits seeking compensation for allegedly illegally unpaid internships has caught many companies by surprise. In several industries – most noticeably Hollywood, where the groundbreaking ruling that prompted the current deluge took place – there’s a barely hidden sense of annoyance that the established order of deference and ladder climbing is being challenged. Yes, this argument goes, it might technically be illegal, but everyone knows, don’t they, that this is how it works? Today’s interns – the up-starts! – just don’t want to earn their stripes.

The crux of the matter is the Department of Labor’s definition of an unpaid internship.

A case of pedants claiming irrelevant legal protections? Or, are the vast majority of unpaid interns being treated unfairly, taken for granted, and being asked to work as employees-in-all-but-name, saving companies money while gaining little for themselves?

A recent lawsuit filed against Donna Karan, the women’s fashion designer, claims just this. According to the suit, employees are being regularly classified as interns and trainees in order for the company to avoid having to pay them. The lead plaintiff in the complaint is Valentino Smith, who worked for the company between January and May 2009. According to the complaint, Smith was listed as an intern and worked without pay but fulfilled tasks, such as fetching coffee and making spreadsheets, that would otherwise have required an employee,

As with all unpaid internship lawsuits, the crux of the matter is the Department of Labor’s definition of an unpaid internship. According to the Department’s regulations, an unpaid position must, among other things, provide training for the intern, rather than simply allowing them to gain ‘experience’.

As many as 100 current and former Donna Karan interns may be able to take part in any proposed class action.

Smith alleges that he worked eight hour shifts, two days a week, in the company’s sales department, yet his duties consisted of menial tasks that would normally be an employee’s duty, such as inventory, merchandise organization, and getting coffee for paid employees. The suit claims that the practice of using interns to avoid paying staff began in 2007, and that interns received no training or education. As such, the company had violated federal wage laws and New York State labor laws, the suit says.

The suit was filed in New York state court.

The case is Valentino Smith v. Donna Karan International Inc. and Donna Karan Studio LLC, Case Number 157912-2013 in the Supreme Court of New York County.