December 8, 2014

Paralegal Students Must Be Paid for Practical Job Experience at Law Firms

We previously addressed the issue of whether an intern is entitled to be paid for time spent with a for-profit enterprise.  We reviewed the Department of Labor’s six-factor test:

  1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
  2. The internship experience is for the benefit of the intern;
  3. The intern does not displace regular employees, but works under close supervision of existing staff;
  4. The employer that provides the training derives no immediate advantage from the activities of the intern, and on occasion its operations may actually be impeded;
  5. The intern is not necessarily entitled to a job at the conclusion of the internship; and
  6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

If any of these requirements is not met, the participant is an employee and entitled to be paid.

Our article also explained that individuals cannot simply volunteer their time for a for-profit enterprise – like a law office – without receiving minimum wage.

Recently, a paralegal student asked us how the DOL’s guidance might apply to other paralegal students seeking real-life experience at a for-profit law office:

My friend just completed a degree in Paralegal Studies.  She was told by the Director of Program Studies that paralegals are not allowed to “volunteer” time for law offices, unless they are in the midst of an internship through school, or if they choose to volunteer their time for a not-for-profit firm/business after completing their studies at school.  All other law firms are prohibited from taking paralegal students as volunteers, despite the fact that paralegal students seek practical work-related experience to secure their first position out of school.  Apparently there can be no volunteering even if both parties have agreed to the arrangement.

This question has stirred up quite a controversy amongst students, new graduates and college instructors.  No one is quite certain how this all works.  How can paralegal students obtain needed work experience when many employers seek at least 2-3 years of experience?

Unfortunately, most law firms do not have an internship program that meets the DOL’s six factor test, and therefore must pay minimum wage to paralegal students who seek practical law firm experience.

The DOL, in an opinion letter from 2013, applied the six factor test to law firms that engage law students to participate in pro bono work. An excerpt is below:

Where the program is designed to provide a law student with professional practice in the furtherance of his or her education and the experience is academically oriented for the benefit of the student, the student may be considered a trainee and not an employee. Accordingly, where a law student works only on pro bono matters that do not involve potential fee-generating activities, and does not participate in a law firm’s billable work or free up staff resources for billable work that would otherwise be utilized for pro bono work, the firm will not derive any immediate advantage from the student’s activities, although it may derive intangible, long-term benefits such as general reputational benefit associated with pro bono activities […] In contrast, a law student would be considered an employee subject to the FLSA where he or she works on fee generating matters, performs routine non-substantive work that could be performed by a paralegal, receives minimal supervision and guidance from the firm’s licensed attorneys, or displaces regular employees (including support staff).

The DOL distinguished the pro bono internship program from “routine non-substantive work that could be performed by a paralegal.”  This language makes it even less likely that law firms can avoid paying paralegals for the practical experience they desire. Further, the opinion letter made it clear that a law graduate (like a paralegal graduate) would not qualify for internship opportunities available to law students.

The best bet for an ambitious paralegal student or graduate is to convince the law firm that he or she will provide value that exceeds the minimum wage that must be paid.

For further information about wage and hour issues, including paying interns and volunteers, contact Foster Pepper’s Employment & Labor group.

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