11th Cir Adopts 7 Factor Glatt Test for Unpaid Internships
The Second Circuit broke ground in July, creating a new standard for determining when interns are actually employees entitled to the benefits of employment, like a minimum wage. In that case, the Second Circuit rejected the six part test put forward by the Department of Labor in favor of a "primary beneficiary test" where employment status is determined by whether the intern or employer is the primary beneficiary.
Now, the Eleventh Circuit has adopted the same standard the Second Circuit announced in Glatt v. Fox Searchlight Pictures. The Eleventh also offered important insight into how lower courts should apply the factors established in Glatt.
Intern: Indentured Servant or Employee?
At their best, internships are valuable apprenticeships which provides valuable experiential learning. At their worst, they're simple exploitation -- unpaid jobs masquerading as learning experiences. In the case of Glatt, one student intern worked ten hour days arranging furniture, taking lunch orders, and throwing out trash. In the Eleventh Circuit's case, Schumann v. Collier Anesthesia, the interns in question were student registered nurse anesthetists (SRNAs). As part of their curriculum, they completed over 500 clinical cases -- working, they allege, more as employees than students.
When the SNRAs sued, the district court applied the Department of Labor's six factor test for determining whether an intern is actually an employee. Those factors, the Eleventh Circuit noted on appeal, are simply the codification of the Supreme Court's ruling in Walling v. Portland Terminal. The Eleventh did not find them persuasive, noting that "with all due respect to the Department of Labor, it has no more expertise in construing a Supreme Court case than the Judiciary."
Further, the Eleventh said, Portland Terminal was designed 70 years ago to address a "very different factual situation" -- a training program by a railroad company designed to create new employees. Modern "longer-term, intensive" internships required to obtain degrees or certifications "are just too different from the short training classes" that inspired Portland Terminal and the DOJ's guidance, the court said.
Adopting, and Explaining, Glatt
The Eleventh adopted the application of Portland Terminal's primary beneficiary test explained in Glatt. Under Glatt, the court still seeks to determine who the primary beneficiary of the relationship is, as required by Portland Terminal. But it does so with more modern considerations. Glatt announced seven non-exclusive factors for consideration:
1. A shared understanding regarding compensation
2. Whether the training provided is similar to that given in an educational environment
3. The connection between internship and educational program
4. An internships accommodation of academic commitments
5. The limited duration of the internship
6. Whether the intern's work complements or displaces other employees' work
7. Whether an intern is entitled to paid work at the end
In adopting Glatt's seven factors, the Eleventh Circuit also added some important guidance to courts applying the test. First, the length of the program should not be treated like "an exact science." An internship need not end at the very first moment possible, but "grossly excessive" lengths may show that the program is for the programmer's primary benefit. Further, courts should also investigate the extent to which other employees are displaced, noting that doctors in the SNRA program used the same amount of student nurses for procedures as they would with registered nurses.
Related Resources:
- Internships: To Pay or not to Pay? (Reuters)
- Unpaid Externships Comply With FLSA if Academic Credit Received (FindLaw's U.S. Eleventh Circuit Blog)
- VSU Administrator Violated Expelled Student's Due Process Rights (FindLaw's U.S Eleventh Circuit Blog)
- 11th Circuit Regulates on Dep't of Labor H-2B Regulations (FindLaw's U.S. Eleventh Circuit Blog)