Between the economy and the lack of workforce development, good employees have been hard to come by in the remodeling industry. One solution has been the use of interns, paid or unpaid.

Interns, generally lower in skill level, almost always work part time and are getting a form of on-the-job training. For these reasons, remodelers struggle to justify spending money for the work interns perform.

In most states, if an “intern” is paid, then the same rules that apply to other paid part-time employees—workers’ comp, hourly wages, overtime—apply to that intern. The harder—and legally more interesting—question is how to treat an unpaid intern.

The Fair Labor Standards Act (29 USC 201 and following) requires certain hourly and overtime pay for those “employed” in the for-profit sector. “Employ” as defined in the FLSA includes the words “suffer or permit to work” for a for-profit company. Under the FLSA, any person who works for your company is presumed to be “employed” unless that individual meets a six-part test found in the Department of Labor’s “Fact Sheet #71: Internship Programs Under the Fair Labor Standards Act.” If the intern meets each of the criteria, then that intern can be unpaid and isn’t subject to the FLSA. If not, then the FLSA applies.

State workers’ compensation statutes vary on whether unpaid interns (even those meeting the FLSA criteria) are covered by workers’ compensation statutes. Be sure to review your state’s rules when making the decision to use unpaid interns.

—Christopher G. Hill, LEED AP, is a Virginia Supreme Court certified mediator, construction lawyer, and owner of The Law Office of Christopher G. Hill, PC, in Richmond, Va. This article is for informational purposes only and should not be construed as legal advice.