Academic Internships Office

Compensation – To pay or not to pay

The issue of compensation for interns is a very sensitive one.

A common assumption is that if the student is earning educational credit, he or she doesn’t have to be paid. Some employers feel that since it is a learning experience for the student, and the employer and the employing agency are providing the learning environment, that the student shouldn’t be paid.

However, if the student is enhancing your productivity, as he or she should be, there should be some compensation. The Fair Labor Standards Act (FLSA) boils down to this: If the student’s presence is not an undue burden to the agency, if staff does not spend a large part of their time training the student, and the student is an asset to the organization, then the student should be paid. Whether the student is enrolled in a credited internship course or not has little bearing on eligibility for compensation.

We, at PLU, anticipate that the internships our students engage in hold a professional level of responsibility which would be contributing to the productivity and adding value to the organization. The student needs to be present at the workplace for a significant amount of time to have this level of impact. Any student working 18 or more hours per week should be contributing significantly to the organization after the initial period of orientation and getting started.

How much should an intern be paid?

Students should be paid whatever the normal wage would be to get the job done. There are other “creative” ways to pay students, with “perks” such as free parking, bus passes, fitness center membership, tuition reimbursement for internship course credits, offers to pay for industry certification courses, etc. While these are attractive to students, it does not replace the motivation and respect of a regular wage.

If you have or are developing an ongoing internship program in your organization, compensation should be part of its structure.

Consider these:

  • Your ability to require top quality performance if you are not paying them for it.
  • The student’s commitment to professional expectations if they are not treated as a professional – just a volunteer.
  • The casual attitude a student may have if they are “just a volunteer” and the tendency to not measure up to standard employment behavior like calling in if they will be late or won’t be in at all if they are sick or must study for an important exam.
  • The difference in the relationship you have with them as a paid employee vs. an unpaid intern.

You are bringing this student on board to do a job for you. Perhaps you are considering them for employment after graduation. If the internship is unpaid, you will not be seeing the student at their top performance, as the potential employee you could have later. Then you cannot make a true assessment of this intern for future employment.

It is also true that often a student must work and go to school. If the internship is not paid, the student must hold another job concurrently as well as meet other academic demands. Think about where their primary loyalty will be.

Work Study

Some small employers and nonprofit organizations do not have the resources to pay students a competitive wage. The State Work Study Program that reimburses up to 65% of wages paid to eligible students might be your key to being able to offer a wage. For more information, please refer to the PLU Student Employment website or visit the Washington State Work Study website.

For a student to experience a truly professional environment in their internship, they need the added respect that compensation brings. Employers need the leverage of a paid position to require high standards of performance.

Categories of Limited Paid Opportunities

There are some professions that may be open to liability risk if they were to pay their interns. These professions manage personal information that relates to the wellbeing of the individual in some significant way: financial, safety, or health. If there were to be a problem, the courts might claim that paid interns could be perceived to be “professionals” because they are paid, even though they are students and have the title of “intern.” Due to the perceived risk of a nonprofessional participating in a professional quality work assignment, organizations such as police departments or similar legal related organizations, financial security organizations, or healthcare related organizations are less likely to be able to offer compensation. Even though all quality organizations train and prepare their students so this risk is extremely low, it is believed to be unwise by these employers to offer paid internships for students involved in opportunities that work in these types of positions due to the perceived potential risk by their insurers.

A second category of limited paid opportunities is in the nonprofit sector. Because their funds are limited primarily to charitable donations (some with restricted government funding), they may not have sufficient funds in their budget to pay a student a regular wage.

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