By Daniel Indiviglio
WASHINGTON, June 17 (Reuters Breakingviews) - Interns are among the best things in life that should be free. A pair of recent U.S. court cases threatens that notion, however. Such unpaid positions generally provide value for employers and unskilled workers alike. Distorting apprenticeship economics could be costly.
Last week, a federal district judge in New York ruled that Fox Searchlight should have paid production interns on the Oscar-winning film 'Black Swan.' A couple of days later, former interns sued Cond?? Nast, accusing the publisher of Vanity Fair and other magazines of paying them too little. These plaintiffs may be doing themselves more harm than good.
While minimum wage rules exist to protect workers, interns are a defensible exception. What the roles lack in hard currency, they more than make up for in experience. Working in film, fashion, publishing or even on Capitol Hill pays skills-learning, contact-making, academic credit-creating and r??sum??-building dividends. The transaction is also completely voluntary: students or recent graduates can seek paid internships or gainful employment elsewhere.
Without the option of bringing on free apprentices, many companies simply wouldn't provide the opportunities. That would be especially damaging in a weak labor market, making work experience harder to come by when employers can least afford to train. For now, the laws of supply and demand seem to be working pretty efficiently when it comes to interns.
Lawmakers also can easily prevent abuse and embrace new ideas to enhance on-the-job learning. For example, in Germany, half the country's young people pursue formally licensed, government-subsidized corporate training programs instead of liberal arts degrees. There would be hurdles to implementing such a program on a scale of the United States, as a Milken Institute paper this month notes, but it could be worth the effort to reduce the nation's education costs and better prepare its workers.
Instead, the Fox ruling risks damaging the precept of unpaid trainees. That could leave students who might otherwise have matched up favorably against candidates with pricier degrees or higher-skilled foreign workers falling short. Many employers also might find they can get by without free interns. That would be a big price for all involved to pay.
- Film studio Fox Searchlight Pictures violated wage laws by not paying two interns who worked on the movie 'Black Swan,' a federal district court in Manhattan ruled on June 11. Judge William Pauley concluded that production interns were essentially regular employees and should have been paid accordingly. He said they did not benefit from an educational environment but the studio benefited from their work.
- Separately, two former interns sued Cond?? Nast on June 13, alleging that the magazine publisher violated the law by not paying them minimum wage. The plaintiffs were paid $300 to $500 each summer for working up to 22 hours a week with responsibilities that included reviewing articles for submission and editing.
- New York Times: Judge rules that movie studio should have been paying interns http://link.reuters.com/quk88t
- New York Times: Cond?? Nast faces suit from interns over wages http://link.reuters.com/ryk88t
Wafer-thin M&A fee, sir?
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(Editing by Jeffrey Goldfarb and Martin Langfield) Keywords: BREAKINGVIEWS INTERNS/
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