Huzzah! — A Federal Court Judge Ruled Against Unpaid Internships
2:30 pm, June 12th | by Colette McIntyre
Yesterday a Manhattan Federal Court District judge ruled that Fox Searchlight Pictures had violated federal and New York minimum wage laws by not paying production interns on the movie Black Swan. Judge William H. Pauley III said that the two interns deserved monetary compensation since they were effectively regular employees on the set.
Eric Glatt and Alexander Footman sued Fox Searchlight in September 2011 claiming that their internships consisted of basic chores — answering phones, taking lunch orders, arranging employees’ travel plans — that were normally undertaken by paid employees. Judge Pauley determined that these tasks did not foster an education environment and primarily served to benefit the company.
“Undoubtedly Mr. Glatt and Mr. Footman received some benefits from their internships, such as résumé listings, job references and an understanding of how a production office works,” he wrote in his opinion. “But those benefits were incidental to working in the office like any other employees and were not the result of internships intentionally structured to benefit them.”
“Searchlight received the benefits of their unpaid work, which otherwise would have required paid employees,” the Judge added.
Judge Pauley’s decision nullifies the argument made by companies like Fox that unpaid internships fall under Department of Labor guidelines since “the internship’s benefits to the intern outweigh the benefits to the engaging entity.” In his opinion, the Judge called such a method of measurement too subjective and unpredictable. He went on to suggest that unpaid internships should be allowed only in very limited circumstances and that academic credit isn’t a valid form of compensation.
“I’m absolutely thrilled,” said Mr. Glatt,. “I hope that this sends a very loud and clear message to employers and to students doing these internships, and to the colleges that are cooperating in creating this large pool of free labor — for most for-profit employers, this is illegal. It shouldn’t be up to the least powerful person in the arrangement to have to bring a lawsuit to stop this.”
The Judge’s decision could have major implications for the thousands of businesses and organizations that rely on unpaid interns to perform the work of entry-level employees. Rachel Bien, a lawyer for the plaintiffs, said “Employers have already started to take a hard look at their internship programs. I think this decision will go far to discourage private companies from having unpaid internship programs.”
Research firm Intern Bridge estimates that undergraduates work in over one million internships a year, half of which are unpaid. If this case does upend the flawed internship system (which is doubtful), one can only imagine how unemployment numbers will change. (Hint: they’d probably go down.) Unpaid internships are unsustainable even for the most hardworking and passionate individuals and they are creating a stagnant workforce. Any ruling that even attempts to upend internship culture is a step in the right direction.