Filed under Employment Law

Unpaid Internships Are A Losing Deal for All But Employers

Unpaid internships exploit the labor of well-to-do young people, disadvantage their peers who cannot afford to work for free, replace paying entry-level jobs, and are often, but not always, illegal. Recently some of these interns have started to strike back by suing for backpay.

Last year, interns for the movie “Black Swan” sued for unpaid wages. On February 1st of this year, The New York Times reported that a former unpaid magazine intern sued Hearst Corporation for violating wage and hour laws. Both of these lawsuits alleged that the employers involved were required to pay for the particular internships at issue.

But sometimes it is legal not to pay interns. Under federal law (some states have additional requirements), unpaid internships are legal if they meet six criteria:

1. The training, even though it includes actual operation of the facilities of the employer, is similar to training available in a school;
2. The training is for the benefit of the intern;
3. The intern does not displace regular employees, but works under their close supervision;
4. The employer that provides the training derives no immediate advantage from the activities of the intern, and on occasion its operations may actually be impeded;
5. The intern is not necessarily entitled to a job at the conclusion of the internship; and
6. The employer and the intern understand that the intern is not entitled to wages.

In short, if an intern isn’t a bit of a burden, the employer must pay her or him. One sign that it is probably legal not to pay interns is when they receive college credit for their work.

But in many workplaces, employers are benefiting from unpaid interns’ work while everyone else involved suffers. In the “Black Swan” case, the plaintiffs claim that they did the same work as paid employees and did not receive training or advance their careers. Meanwhile they had to pay for their own room, board and expenses while Fox Searchlight Pictures exploited their free labor.

The interns weren’t the only ones who took a hit to their wallets. Uncompensated internships can contribute to unemployment. In the “Black Swan” situation, for instance, free interns did the same work as paid employees, and may have displaced people who used to do their work as a full-time job and are now unemployed.

Unpaid internships that do comply with the law harm another population: the many students and recent graduates who would benefit from the training and contacts internships can provide but who lack the resources to support themselves while working for free. Young people who already have the advantage of well-off families build on that head start with the training and foot-in-the-door that internships can provide. Once again the rich get richer, but instead of money, they accrue experience, valuable professional networks and sometimes even permanent jobs.

In February, Occupy Wall Street called on the New York Foundation for the Arts to stop advertising any and all unpaid internships. They may have the right idea. While people who worked in unpaid internships fight their former employers for back pay, this system raises a broader question: should unpaid internships be legal at all?

 

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Schoolyard Bullies Are All Grown Up and Working in the Next Cubicle

Check out my “Dose” on workplace bullying at Dame Magazine: “Office Bullies, Listen Up: Sign this anti-bullying petition, or I’ll steal your lunch money.” And while you’re there, check out my friend Amy Klein’s great essay on the very awesome Hunger Games.

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When Are Unpaid Internships Legal?

We’re coming up on summer, season of internships. Many students take unpaid internships for the learning experience or because they will look good on a resume, but some of them are being cheated out of the wages they should be earning.

Under a federal law called the Fair Labor Standards Act employers must pay their interns unless they meet all six of these criteria:

  1. The training, even though it includes actual operation of the facilities of the employer, is similar to training available in a school;
  2. The training is for the benefit of the intern;
  3. The intern does not displace regular employees, but works under their close supervision;
  4. The employer that provides the training derives no immediate advantage from the activities of the intern, and on occasion its operations may actually be impeded;
  5. The intern is not necessarily entitled to a job at the conclusion of the internship; and
  6. The employer and the intern understand that the intern is not entitled to wages.

One good indicator that it is legal not to pay an intern is if the student is earning academic credit for her work, but that alone is not a substitute for meeting all six of the required factors.

Employers, take heed: just because you hire students for a limited time doesn’t excuse you from paying them. Note especially factor number four: interns often don’t help much and sometimes get in the way. If that isn’t true, they are entitled to (and worth) a paycheck!

 

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The Top Ten Reasons to Hire a Lawyer to Review Your Severance Agreement

Forbes.com published my article, co-written with Tammy Marzigliano, about how to get the best severance agreement you can. Read it at http://www.forbes.com/sites/susanadams/2011/12/01/the-top-ten-reasons-to-hire-a-lawyer-to-review-your-severance-agreement/ in Susan Adams’ column.

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How to Get Your Bonus After You’ve Been Laid Off or Fired

You lost your job before bonuses were paid out for the year. Think you can’t get your bonus? You may be wrong. Read about what you can do in my article at Forbes.

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Judge Rules That Firing Woman Over Pumping Breast Milk Is Not Sex Discrimination

Lactation is not a medical condition related to pregnancy or childbirth, and firing someone who wants to pump breast milk is not sex discrimination, according to a federal judge in Texas.

This decision is a stumper. Lactation occurs because of and immediately following pregnancy and childbirth, which makes it “related” to them. Only women lactate, so firing an employee because she needs to pump does discriminate against her on the basis of her sex.

The Equal Employment Opportunity Commission brought this suit against debt-collection agency Houston Funding on behalf of an employee whom the company fired, allegedly because she wanted to pump at work. The EEOC is considering appealing the decision by Judge Lynn Hughes (who is male).

Since the firing the federal government passed a law requiring employers to provide break time for new mothers to pump breast milk at work, but it does not prohibit employers from firing workers for pumping. One might have presumed that the anti-discrimination laws already had that covered, but now that is up in the air, and it will probably take years and opinions from higher courts to clear it up.

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Women Don’t Want to Balance Work and Life

Women want more life and less work, and they are willing to sacrifice to get it.

Working women tend to value their personal lives more than professional advancement, according to a new survey from More Magazine. It found that “65% of women say it’s more important to have TIME in their life than to make more MONEY at their job” and “73% say if their boss left her job, they would NOT apply to replace her.” These priorities are trending: “43% say they are LESS AMBITIOUS now than they were 10 years ago,” and “58% say that flexibility is more important to them now than it was 10 years ago.”

I wonder how men would answer the same questions. Is this the mood all over? Is it a result of women finding that jobs aren’t all they were cracked up to be?

Beyond women’s feelings about work, this survey should help bust the stereotype of women as materialistic opportunists who seek mates who can buy them lots of shoes, since 65% of women polled prefer time over money. That should put the canard to rest…but it won’t.

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Cain’s Alleged Affair Turns Off Voters More Than Sexual Harassment Accusations

Apparently voters don’t mind sexual harassment. A candidate who illegally degrades and even assaults women in the workplace is electable. What voters will not tolerate is a consensual affair.

Herman Cain is losing support because a woman accused him of having an extramarital affair with her, according to today’s New York Times. The paper quoted Mike Huckabee saying that the allegation of an affair “is one that could upend his presidential campaign.” Apparently all the prior allegations of sexual harassment were not “ones that could upend” a campaign.

The paper also quoted “a conservative” from West Des Moines who, it reported, had supported Cain “through the accusations of sexual harassment,” but considered the allegation of an affair “different.” Because of the alleged affair, she said, “I would guess Herman Cain is not electable now.”

These two aren’t alone. The Times found that the “support from many conservatives, which poured in after reports of sexual harassment were first made against Mr. Cain nearly a month ago, was significantly muted.”

How to explain the combination of equanimity in the face of multiple sexual harassment accusations on the one hand, and communal backing away from the suggestion of one affair on the other? Perhaps conservatives just don’t believe sexual harassment happens but know that affairs do. But the sad truth is that some men cheat on their wives, some men harass women they have power over, and some men do both.

Both types of accusation reflect on Cain’s fitness for office. Having an affair means he broke a promise, which, while not a desirable trait in a politician, is an inevitable one. Sexually harassing subordinates means he abused his power in order to hurt people. Call me wild-hearted or a bleeding eye or whatever, but I think that is worth voting against.

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Court in Costco Discrimination Case to Employers: Don’t Fight Discrimination

Plaintiffs suing Costco for sex discrimination face another round of litigation thanks to the Supreme Court’s recent dismissal of the Wal-Mart sex discrimination case. Because of the Supreme Court’s decision, the Ninth Circuit Court of Appeals ruled on Friday that the Costco trial court must reconsider whether the plaintiffs can prove that the company should be liable for sex discrimination in store-level promotions. On this question the Court of Appeals, like the Supreme Court before it, ruled the wrong way, discouraging companies from implementing measures that would prevent discrimination.

When companies leave employment decisions like promotions to individual decision-makers without giving them clear, relevant criteria to guide their decisions, those decisions are often discriminatory, albeit sometimes unintentionally. Many corporations, including Costco, provide no uniform criteria – or any guidance at all – for making promotion decisions. This leaves each individual manager (the vast majority of whom are male at Costco) to make promotion decisions as he sees fit. When making decisions with unfettered discretion, people tend to rely on stereotypes and to promote those they are most comfortable with and who are most like them – in short, in the absence of clear criteria, men usually promote men. Witness Costco’s demographics: female lower-level managers at Costco are less likely to be promoted than their male counterparts. It appears that only two of Costco’s top 34 executives are women. The problem is not a shortage of interested or qualified women: Costco’s competitors have a much higher proportion of women in management than Costco does.

Companies can prevent this kind of discrimination. Sociological research shows that holding top management responsible for establishing and enforcing uniform, unbiased promotion criteria goes a long way. When companies provide managers with performance-related criteria for promotion decisions, managers can evaluate whether a candidate satisfies those criteria instead of making a gut-level decision based on personal relationship or other irrelevant factors.

Companies can also prevent sex discrimination in promotions by increasing the pool of candidates. When employees don’t know promotions are available, managers may not even consider qualified women for the positions – they may not know them well, or may rely on stereotypes to conclude that they don’t want promotions. The Costco case illustrates these consequences: the three women who sued desperately wanted promotions, but none of them ever applied for one – they couldn’t, because Costco did not accept applications, and they never knew when promotions were available anyway. An easy fix is to inform employees of promotion opportunities and invite applications. Interested women will throw their hats in the ring and managers will evaluate them based on the relevant criteria, resulting in more promotions of women.

The courts in Costco and Wal-Mart ruled the wrong way because they discouraged companies from adopting these measures. They held that corporations are not liable in class actions for the discretionary decisions of individual managers, creating an incentive for companies to wash their hands of preventing discrimination in their ranks. The more anarchic the system for decisions about promotions and other perks – raises, bonuses, etc. – the more insulation the company has from discrimination class actions. The Costco decision quoted the Supreme Court’s Wal-Mart ruling on this point: “demonstrating the invalidity of one manager’s use of discretion will do nothing to demonstrate the invalidity of another’s. A party seeking to [bring] a nationwide class [action] will be unable to show that all the employees’ Title VII claims will in fact depend on the answers to common questions.” In other words, if the only thing promotion decisions have in common is that managers make those decisions however they want, the company as a whole is not liable for resulting discrimination. In contrast, if the company disseminates guidelines for making promotion decisions that result in discrimination, the company can be held liable.

Smart companies will adopt best practices like enforcing uniform criteria for promotion decisions, both to retain and get the benefit of employing talented people and to avoid discrimination suits by individuals, which are not affected by the Wal-Mart and Costco decisions.

The Court of Appeals sent the Costco class action case back to the trial court for reconsideration, giving the plaintiffs another chance. But the trial court will labor under the higher court’s instruction (again, quoting the Wal-Mart decision) that it “must determine whether there was ‘significant proof that [Costco] operated under a general policy of discrimination.’” Proving that Costco operated under a general policy of laissez faire will not suffice to save this sex discrimination case.

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Bloomberg did not discriminate against women by treating new mothers the same as other leave-takers

Article first published as Judge: Bloomberg Did Not Discriminate Against Women on Blogcritics.

The judge who ruled that Bloomberg LP did not illegally discriminate against women for taking pregnancy leave raised an important policy question in her written opinion. Judge Preska did not drop “an anvil…on the work-life balance scale,” despite commentators’ efforts to portray her decision as a calculated blow against work-life balance; in deciding in Bloomberg’s favor, all she did was follow the existing law. In her commentary, however, she questioned the wisdom of the law itself, and noted that one alternative might be for employers to “treat pregnant women and mothers better or more leniently than others.” Judge Preska did not say whether she thinks that would be a good idea. It is a dreadful idea.

The judge’s legal reasoning in the Bloomberg ruling is by the book. The federal law bans pregnancy discrimination as a form of gender discrimination, as it should – only women get pregnant. The law does not require employers to treat pregnant women better than other employees, just not to treat them worse. Based on the evidence Judge Preska summarized in her decision, Bloomberg LP did not treat women who took pregnancy leave worse than other leave-takers; to the contrary, if that evidence is to be believed (in an earlier ruling Judge Preska threw out the Equal Employment Opportunity Commission’s expert witnesses, leaving the evidence lopsided in Bloomberg’s favor), women returning from maternity leave may have fared slightly better in terms of compensation than employees returning from other kinds of leave.

The evidence also showed that taking leave for any reason is not a wise career move at Bloomberg. The company policy is, in essence, that employees must put Bloomberg LP ahead of God, country, family, and whatever else figures in their particular pursuits of happiness. Bloomberg scoffs at work-life balance, and while that might be poor business judgment or even reprehensible, Judge Preska was correct that it is not against the law.

Judge Preska makes it clear that the law, whether she likes it or not, grants employers the right to ignore and even discourage workers’ lives outside of work. She quotes former General Electric CEO Jack Welch’s grim assessment that there is “no such thing as work-life balance. There are work-life choices, and you make them, and they have consequences.”

The judge writes that “it is not the Court’s role to engage in policy debates or choose the outcome it thinks is best. It is to apply the law.” Judge Preska goes on to discuss all the things that courts do not have the power to police. She includes in that list what she calls “work-family tradeoffs” – she does not believe one can have it all. But maybe one can have more than Bloomberg gives: the judge observes that it “may be desirable” and “may make business sense” for companies to “treat pregnant women and mothers better or more leniently than others.”

I disagree. Treating pregnant women and mothers more leniently than other employees is not desirable. The view that pregnant women and mothers deserve special treatment may appear feminist, but it actually serves the interests of those who want women pregnant and at home while daddy wins the bread. The law already bars employers from discriminating against women because of pregnancy and related medical conditions, so this policy question is not about whether women’s biology holds them back in the workplace. It is about whether some mothers’ choices to spend more time away from work than fathers and non-parents do should be underwritten by the government and employers.

“Treat[ing] pregnant women and mothers better…than others” would be an insult and a disservice to several groups of “others.” First, fathers: why should employers treat mothers better than fathers? To ensure that women take more time off work and that men don’t? To reinforce sexist stereotypes that, compared to men, women are better at/prefer/should be raising children? Those stereotypes don’t need much reinforcement: studies have shown that men who take paternity leave are later penalized in terms of compensation and promotion compared to men who leave all the child-rearing to women. The attitudes behind those penalties are the same attitudes that support treating mothers better than other employees.

The second group of slighted “others” is the ill and disabled: why should pregnant women and new mothers be treated better than employees who take leave that is necessary for different medical reasons? Pregnant women at least chose to suffer their medical condition, unlike people who have to take leave for, say, a kidney transplant, or to care for a dying parent. Pregnant women and new mothers should not be treated worse than others with medical conditions, and they should not be treated better.

Third, non-mothers: treating female employees who choose to bear children better than those who do not (and in some cases cannot) devalues the lives of women without kids. Requiring employers to treat mothers better in the workplace than women who are not mothers would divert both public and private resources to subsidize the individual lifestyles of people who choose to have children. People do not have children for the greater good or out of a sense of civic duty – they have children because they want to. It makes no sense to force employers to grant preferential treatment to women who choose to spend their time and resources having children over women who choose to spend their time and resources doing something else. It is not up to employers to value any of these private, non-employment-related choices over the others.

Judge Preska put a point on this policy debate by referring to “work-family tradeoffs” rather than “work-life tradeoffs.” But these are not the same thing. Family is not a substitute for life; family is a part of life, but there is more. For most people blessed with the resources to choose how to spend their time, life includes friends, the arts, physical activity, spirituality, or any of many other interests. The judge’s phrase, “work-family tradeoffs,” frames the issue as a question of trading family time for work time, implying that family is the only thing that could possibly merit time off of work. In the context of a gender discrimination case like this one, this framing is not only reductionist, it is frightening in its confinement of female employees to only two spheres: family and making a living.

Judge Preska merely outlines the policy choice of favoring mothers over other employees. She does not claim it as her own. But it is not a straw man: it is at the heart of many “work-life balance” criticisms of the judge’s ruling. Critics are not satisfied with the law’s requirement that employers treat women who take medical leave related to pregnancy the same as other employees who take leave for other reasons. They want pregnancy and motherhood to be privileged.

I am not on Bloomberg’s side. Expecting employees to put work above all else is a recipe for misery for all but workaholics, and an ugly manifestation of corporate greed. But putting children above all else is not the answer for everyone either.
Judges lack the power to force employers to facilitate humane work schedules, and in a free market with more workers than jobs, employees lack the leverage to reach company- or industry-wide bargains for a better balance. At least for now, people who choose to have children will have to make trade-offs to pursue their dreams the same way that people without children do. Under the Pregnancy Discrimination Act and Judge Preska’s ruling, pregnancy and related medical conditions are not a part of that trade-off – they should have no different effect than any other medical condition.

If other “work-family” trade-offs continue to fall more heavily on mothers than fathers, they will have a discriminatory effect. The most immediate and attainable palliative is for fathers to step up and mothers to step back. As more fathers take more parental leave the stereotype of women as children’s natural caretakers will begin to erode, and if women take less leave, the stereotype that women are not as committed to their work as men are may begin to erode too. Parents who can afford for mom to take non-medical time off with the kids should not wait for the courts or the legislature to solve their childcare challenges. They should tap underutilized in-house talent instead: dads.

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