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Unpaid internships: Low salary vs. no salary

In what’s become a time-tested way to gain work experience and professional contacts, hundreds of thousands of young college graduates are taking internships in lieu of full-time jobs. Such positions are especially sought after in today’s sputtering job market. But many of these young college graduates won’t be paid, despite performing essential office functions. Now, after a decision last month by a federal judge in New York, such unpaid positions may soon be a thing of the past.

US District Judge William H. Pauley III ruled that Fox Searchlight Pictures had violated the law when it failed to compensate interns working on the film “Black Swan.” Fox is hardly alone in this practice. Unpaid internships are utilized by thousands of companies, and are especially common in the start-up world, where fledgling companies often struggle to make their payrolls.

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Recognizing that workplace experience can provide a genuine learning opportunity, the Fair Labor Standards Act lays out six conditions under which an unpaid internship could be legal. But other forms of employment — in which an intern is performing tasks that benefit the employer, have no particular educational benefits, and would otherwise be assigned to paid workers — must be compensated.

Without a long list of internships on a resume, finding a job with a future can be quite difficult. But when unpaid internships become the expected way to break into a desirable industry, it means that graduates whose parents are wealthy enough to cover their expenses have a major advantage over their poorer counterparts. It also means that older paid employees can be replaced with a free young work staff.

While it’s entirely reasonable for ambitious young people to accept a relatively low salary to gain solid experience, there’s a big difference between a low salary and no salary. Companies that are genuinely committed to providing valuable, distinctive training to young workers can go on offering unpaid internships. Other employers must pay at least the minimum wage.

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