The California Department of Industrial Relations Division of Labor Standards Enforcement (DLSE) recently issued an opinion letter addressing whether California law requires employers to treat interns participating in particular educational programs as employees.

The DLSE noted that no California statute or regulation specifically exempts trainees or interns from state minimum wage and overtime requirements that apply to non-exempt employees. Historically, California has followed federal interpretations, which have found that trainees and interns who participate in a bona fide internship or training program fall outside the minimum wage laws.

The key question, then, is which internships and training programs qualify participants for exemption? In the past, the DLSE seems to have used an  eleven-factor test to evaluate the trainee/intern’s status; the opinion letter appears to instead adopt the six-part test adopted by the federal Department of Labor to determine whether the trainee/intern falls in the category of an employee or is exempt from the requirements. The Department of Labor’s criteria are as follows:

1. Is the training, although it includes actual operation of the employer’s facilities, similar to that which would be given in a vocational school?

2. Is the training for the benefit of the trainee/intern?

3. Do the trainees/interns displace regular employees, or do they work under close observation of employer’s normal employees?

4. Is there any guarantee of a job for the trainee/intern at the conclusion of the training period/internship?

5. Do both the employer and the trainee/intern understand that trainees/interns are not entitled to wages for the time spent in the training program/internship?

6. The employer does not derive any immediate advantage from the activities of trainee/interns, and on occasion the employer’s operations may be impeded.

All in all, the status of trainee/interns will be decided on a case-by-case basis. Each program will be evaluated under the six-part test to determine if participants fall outside California’s normal wage laws.

The opinion letter regarding educational internship programs and other opinions can be found online at http://www.dir.ca.gov/dlse/OpinionLetters-byDate.htm.


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