Last week, we began a discussion of the rules and regulations surrounding unpaid internships. Under federal and California employment law, the majority of interns who work for private, for-profit companies must be paid at least minimum wage. Contrary to widely-held beliefs, high school or college credit is not a requirement for an unpaid internship, and it does not make an otherwise illegitimate unpaid internship legal.

In our previous blog post, we detailed the six requirements for unpaid internships as laid out by the United States Department of Labor. Essentially, the intern must benefit from the internship more than the employer does, and the employer must be clear that the internship is unpaid and that there is no guarantee of paid employment after it ends.

In general, California employment law sets out similar criteria for determining whether an intern is a "trainee" and is therefore exempt from the state's minimum wage law. However, instead of examining each of the six requirements individually, the state will look at the "totality of the circumstances" to determine whether the intern must be paid minimum wage.

This more general examination of the circumstances surrounding an internship means that California employers may have less difficulty overcoming the minimum wage requirement for internships. In California, the minimum wage is $8 per hour, although some cities have set a higher minimum.

The unpaid internship rules generally do not apply to most government agencies and non-profit companies. However, if the non-profit is making a profit through commercial activity, such as retail sales, they must meet the same California state or federal criteria as private employers.

Source: Naples Daily News, "Internships usually must pay minimum wage," Kathleen Pender, 22 June 2011