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Guidance Issued on Unpaid Interns and FLSA Compliance

The Department of Labor (“DOL”) has introduced a new seven-factor test to help determine whether students and interns working at for-profit organizations qualify as employees eligible to receive minimum wage under the Fair Labor Standards Act (“FLSA”). An update from the previous version, the DOL’s new test is more beneficial to companies and examines the primary beneficiary of the employer-intern work relationship. The new guidance is also applicable to nonprofit organizations that offer interns stipends or other payments that are below the nation’s minimum wage ($7.25/hour).

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