Unpaid Internship Lawsuits Update

In June 2013, a New York judge ruled that Fox Searchlight had violated the Fair Labor Standards Act by failing to pay its interns. The workers argued in a class action lawsuit that the tasks they carried out were essentially the same as paid employees, and as such they deserved to be compensated. The case went to court, which sided with the plaintiffs. Everything was simple, and that was the end of that.

In the brave new world of unpaid intern lawsuits, things may soon change.

Except, of course, that it wasn't. At the time of the Fox Searchlight ruling, employers warned that a precedent was being set, opening companies up to lawsuits from the thousands of unpaid interns who take temporary positions every year. Workers' rights advocates, on the other hand, hailed the ruling as a victory that would open companies up to lawsuits from the thousands of unpaid interns they hire.

The difference is a matter of opinion. While internships are governed by strict Department of Labor rules, these have rarely been enforced, encouraging an environment across the working sector where unpaid internships often equate to grunt work and "paying your dues." While technically illegal to withhold pay while having an intern perform employee-level tasks, a lack of understanding coupled with employers' expectations made it hard for individuals to enforce their rights. The recent economic troubles and the ever-increasing competitiveness of the job market made job seekers less reluctant than ever to question what they were given. In the brave new world of unpaid intern lawsuits, things may soon change.

A growing number of lawsuits have been filed seeking compensation for unpaid interns. The majority of these cases accuse companies of misclassifying workers as interns in order to avoid paying them, while still failing to offer them training. Current and former interns have also alleged they were routinely asked to perform tasks that benefitted the companies and would have required a paid employee had the intern not been present. These tasks included filing, getting coffee, and other administrative work. Whether this will mean to end of internships or just the improvement of conditions remains to be seen. Either way, a number of prominent companies now face legal action.

Case details for lawsuits against Gawker, Atlantic Records / Warner Music, Conde Ne, and MSNBC / Saturday Night Live can be found in our July post Unpaid Internships Are The New Black.

Charlie Rose

A class action lawsuit filed in March 2012 has been settled by talk show host Charlie Rose over allegations that more than 190 interns working for the show between 2006 and 2012 were unpaid. The lead plaintiff, Lucy Bickerton, claimed she regularly worked 25 hours per week without receiving any pay.

Pittsburgh Power

The arena football team has been hit with a class action - estimated to be worth more than $5 million - by a former intern who alleges he worked on marketing, bookkeeping and janitorial duties without receiving pay. Christopher Boyle allegedly worked as an intern from 2011 to 2012 and filed the suit in May 2013 under the FLSA and Pennsylvania's Minimum Wage Act. The team has moved to have the suit tossed, claiming that the two other named defendants - the team's owners - were never cited as supervisors by Boyle.

Madison Square Garden

In one of the most recent unpaid intern lawsuits filed again a company for alleged FLSA violations, lead plaintiff Christopher Fraticelli claims that the arena improperly classified him and other interns and withheld pay. The workers were allegedly classified as interns or "student associates" despite performing employee-level tasks, such as opening packages and data entry. The allegations date back to 2007.

Donna Karan

The women's fashion designer is facing claims that employees are being misclassified as interns and trainees to save the company money, despite working to fetch coffee, make spreadsheets, and carry out other tasks that would require a paid employee. Full case details can be found here.

Columbia Recordings Corp

A subsidiary of Sony, Columbia Recordings was hit with a putative class action lawsuit in August when a former intern accused the company of withholding pay from her and 500 other interns between 2008 and 2013. The suit alleges that the company benefited from work carried out by interns, yet failed to pay them in violation of New York state labor laws and the FLSA.