Fox Unpaid Internship Case May Lead To Flood Of Lawsuits

July 25, 2013
By Brady & Associates on July 25, 2013 2:18 PM |

News of the recent victory by two interns with Fox Searchlight has some employment law experts saying private companies should brace for a surge of lawsuits from other interns who feel they were unfairly taken advantage of by their employers.

Only days after the Manhattan Federal District Judge William Pauley held that Fox had violated minimum wage law by not paying two production interns working on "Black Swan" other former interns announced similar lawsuits. In one case, two former interns at the New Yorker magazine and another from W Magazine filed suit against the parent company, Conde Nast Publications. The cases represent what many believe is the first wave of lawsuits challenging private corporations who pay little or nothing for intern labor.

Experts believe the first round of such lawsuits will impact what are known as "glamour" industries such as movies, music, television and publishing. These suits will likely cause employers in those sectors, and eventually those in other industries, to reconsider whether using unpaid interns is worth the risk of a future lawsuit.

In the case of the W Magazine intern, Lauren Ballinger, the lawsuit complains she was paid $12 a day to organize accessories, run personal errands for supervisors and make deliveries of merchandise to various vendors. Matthew Lieb, an intern at the New Yorker, says he received a flat $300 for each three-month internship and was required to respond to emails to the magazine, proofread articles and open mail.

Both interns have sued, claiming a violation of the Fair Labor Standards Act, which requires that companies abide by an hourly minimum wage. The two are seeking permission to launch a class action suit against Conde Nast on behalf of all former unpaid or low paid interns.

The recent lawsuits follow in the footsteps not only of the Fox case, but also a suit by Xuedan Wang, a former Harper's Bazaar intern. In that case, Wang claims she was required to work between 40 and 55 hours per week without pay. In February of this year an unpaid intern with a model management company sued Elite Modeling for $50 million on similar labor law grounds.

Even more surprising was the recent revelation that Charlie Rose and his production company agreed to settle a claim brought by unpaid interns. Rose announced that he would pay back wages to as many as 189 interns, with the settlement totaling around $1,100 per person.

Experts say beyond wanting fair compensation for their work, the interns have realized that working for free actually costs them even more money in the long run. A survey conducted by the National Association of Colleges and Employers found that while paid internships increased the chance of receiving a permanent job offer, unpaid internships only slightly increased a person's chance of getting a job over someone who did no internship at all. Moreover, the median starting salary for a new college grad with a paid internship was nearly $52,000, but only $35,000 for those who did unpaid work. The results indicate that by accepting an unpaid position, graduates may be signaling to the employers that they are not worth as much money as other candidates.

Sources:

Employment Experts Predict Wave of Lawsuits from Unpaid Interns, by Amanda Becker, published at Reuters.com on June 14, 2013.

Unpaid-Intern Lawsuits Explained, by Eric Spitznagel, published at Businessweek.com on June 27, 2013.

See Our Related Blog Posts:
Case Against Fox Could Spell Big Changes For Internship Programs Across The Country
Supreme Court Says Drug Reps Not Owed Overtime