Are Your Winery Interns "Employees" That Need to be Paid?

Recently, the California Department of Industrial Relations Division of Labor Standards Enforcement (DLSE) issued an opinion letter concerning educational internship programs.  Specifically, the letter addressed whether California law would require employers to treat interns of a particular educational program as employees.
The DLSE noted that there is no California statute or regulation which exempts trainees or interns from the minimum wage and overtime requirements.   Rather, the DLSE noted that California’s definitions of “employee” and “employ” are similar to the federal Fair Labor Standards Act and that California has historically followed federal interpretations which have recognized that certain trainees and interns who participate in a bona fide internship or training program fall outside the minimum wage laws.
The question becomes how does one determine whether a “trainee” or “intern” is exempt?  The DLSE has used an 11 part test in the past.  With this opinion letter, the DLSE seems to reject the 11 part test and instead relies on the six part test articulated by the federal Department of Labor to determine whether a trainee or intern is an employee or exempt from coverage.  The relevant six criteria are as follows:
1.        The training, even though it includes actual operation of the employer’s facilities, is similar to that which would be given in a vocational school;
2.        The training is for the benefit of the trainees or students;
3.        The trainees or students do not displace regular employees, but work under their close observation;
4.         The employer derives no immediate advantage from the activities of trainees or students, and on occasion the employer’s operations may be actually impeded;
5.        The trainees or students are not necessarily entitled to a job at the conclusion of the training period; and
6.         The employer and the trainees or students understand that the trainees or students are not entitled to wages for the time spent in training.
The bottom line is that there is no bright line answer to the question of whether an intern is an employee under the law.  Each internship or training program needs to be analyzed under this applicable six part test to determine if the participants fall outside California’s wage and hour laws.
For further information or assistance on employment or labor matters contact Jennifer Phillips at [email protected].
Copyright Dickenson Peatman & Fogarty at www.lexvini.com