Calling the Department of Labor's Fact Sheet #71—"Internship Programs Under the Fair Labor Standards Act"—"a poor method" and "overly rigid and inconsistent," the 6th Circuit Court of Appeals has ruled in favor of a for-profit nursing home that relied in part on interns to run its operations.
The Labor Department issued a six-factor test to determine internship status to great fanfare a year ago and announced that it would be cracking down on businesses that misclassified as interns people who were otherwise doing work that should be compensated.
In Solis v. Laurelbook Sanitarium and School, Inc., the DOL's litmus test was rejected by the justices, who wrote:
[W]e hold that the proper approach for determining whether an employment relationship exists in the context of a training or learning situation is to ascertain which party derives the primary benefit from the relationship. Factors such as whether the relationship displaces paid employees and whether there is educational value derived from the relationship are relevant considerations that can guide the inquiry.
Of course, this is no indication that other courts won't side with the DOL, but in the 6th Circuit at least, a new standard has been set.
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