Hammoud Legislation Provides Protections for Unpaid Interns

Bill codifies federal standards into state law
Monday, July 17, 2017

LANSING — State Rep. Abdullah Hammoud (D-Dearborn) has introduced House Bill 4878, which would amend the Workforce Opportunity Wage Act (PA 138 of 2014) to establish protections for unpaid interns in the private sector. These protections stem from U.S. Department of Labor standards, which would be codified into state law. One additional standard was added that would limit unpaid interns to 30 hours of work per week.

Specifically, the bill would exclude an unpaid intern from the definition of an employee. This would determine whether interns must be paid the minimum wage and overtime under the Fair Labor Standards Act for the services that they provide to for-profit, private-sector employers. The following seven criteria must be applied when making this determination:

  1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment.
  2. The internship experience is for the benefit of the intern.
  3. The intern does not displace regular employees, but works under close supervision of existing staff.
  4. The employer that provides the training derives no immediate advantage from the activities of the intern.
  5. The intern is not necessarily entitled to a job at the conclusion of the internship.
  6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.
  7. The intern works for the employer 30 or fewer hours each week.

“Internships are meant to benefit students and increase skills through practical, hands-on experiences in their field,” Hammoud said. “The standards in this bill would protect unpaid interns, prohibit businesses from displacing paid workers with unpaid interns, and would ensure that interns are gaining valuable knowledge and experience.”