Warm weather and summer are approaching, and so too is the end of the school year. As a result, many businesses may now or soon be considering bringing on a summer intern. Students in various industries and stages of education are likely seeking short-term employment. Employers need to be on alert, however, as even those seeking “unpaid” internships may qualify as “employees” under federal law, and be entitled to minimum wage and overtime pay.

The U.S. Department of Labor (“DOL”) has issued specific guidelines concerning for-profit employers and internships. A company should carefully consider whether its summer interns will be considered “employees” for purposes of federal wage and hour laws, and thus subject to minimum wage and overtime requirements. The DOL has established seven key factors relevant to this determination:

1. The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa.
2. The extent to which the internship provides training similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.
3. The extent to which the internship is tied to the intern's formal education program by integrated coursework or the receipt of academic credit.
4. The extent to which the internship accommodates the intern's academic commitments by...

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