Guidelines for UI Departments - Non-paid Interns & Processing of Educational Stipends for Interns
Non-paid internships must meet the Fair Labor Standards Act and the U.S. Department of Labor’s (DOL) guidelines for a Trainee/Learner, found in the DOL’s Field Operations Handbook
(Chapter 10-B11). These guidelines state that if an internship meets the six criteria listed below, the position can be categorized as a Trainee/Learner position and does not need to follow minimum wage regulations. If your internship does not meet these criteria, an employment relationship exists and you must post your position through Human Resources, hire the best qualified candidate, and pay the employee at least minimum wage.
- The training, even though it includes actual operation of the employer’s facilities, is similar to training that would be given in a vocational school.
- The training is for the benefit of the student.
- The student does not displace regular employees, but works under the close observation of a regular employee.
- The employer provides the training and derives no immediate advantage from the activities of the student.* Occasionally, the operations may actually be impeded by the training.
- The student is not necessarily entitled to a job at the conclusion of the training period.
- The employer and the student understand that the student is not entitled to wages for the time spent training.
* If the internship is more of a training/learning experience, as opposed to a job, it is typically acceptable if the employer derives some advantage from the student’s service. The internship must be predominantly for the benefit of the student and not the employer.
Appointing an Intern
- Check to make sure your internship meets the criteria listed above. If your position does not meet the criteria, you must post your position through UI Human Resources.
- Develop a position description for your internship (template found on Career Center's Employer’s page).
- Post your internship on Vandal CareerConnection. A member of the Career Center's Employer Relations team can help you through this process.
- When you are ready to make an offer, provide your new intern with an offer letter using the Offer letter template for non-paid interns with stipends that explains the criteria for unpaid interns. Keep a copy for your records.
Please Note: Since only authorized volunteers are entitled to the protection of the university’s liability insurance program, you should have interns complete the volunteer authorization form available on the Administrative Procedures Manual website (Chapter 05.11 – Authorization of Volunteers)
Awarding Educational Stipend to Interns
Payments of educational stipends for interns can be provided as long as the internship opportunity meets the criteria outlined above. It is important that you keep adequate documentation and use the proper wording on your Claim Voucher. This will help should Internal Audit or the Dept. of Labor audit the records.
- Claim Vouchers are used to pay interns for their education stipend. Use Expense Code E7110 (Educational scholarships & prizes). In the description, be sure to explain that the payment is an educational stipend for your intern, not a payment for employment. i.e. Educational Stipend for Joe Vandal, Marketing Intern for Career & Professional Planning during the Spring 2008 semester. This educational stipend is not a payment for employment and should not be processed through payroll. This stipend is to help defray some of the educational expenses of this student.
- Submit a copy of your offer letter (see #4 above) with your CV to Accounts Payable.
- If your intern has never been employed by the UI, you will also need to have the student complete a W-9 and submit it to Accounts Payable with the CV and offer letter (W-9 forms can be printed from the Accounts Payable website).