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Analyzing Second Circuit's Ruling on Internships
This summer, the U.S. Court of Appeals for the Second Circuit decided Glatt v. Fox Searchlight Pictures, 791 F.3d 376 (2d. 2015), an important decision concerning whether Fox's unpaid interns were “employees” under the federal Fair Labor Standards Act and the New York Labor Law (collectively, the FLSA) and, therefore, entitled to recover minimum wage, plus time-and-a-half for overtime, for the periods they worked at Fox.
The Second Circuit reversed the lower court's decision that Fox's interns were employees under the FLSA. Media coverage characterized the Second Circuit's decision as a decisive victory for employers and a defeat for interns. But don't believe the hype. The Second Circuit held that the lower court applied the wrong test for determining whether interns are exempt from the FLSA and remanded the case to be decided under a different ' but not necessarily more lenient ' test. The Second Circuit's decision, moreover, stands out as the only significant decision addressing this important topic, newly imposes important educational requirements upon exempt internship programs and will flunk many internship programs.
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