Judge William H. Pauley of the U.S. District Court for the Southern District of NY, ruled that unpaid interns who worked on the Grammy award winning movie “Black Swan” are employees entitled to the wage-hour protections of the Fair Labor Standards Act (FLSA) and the New York Labor Law (NYLL).

Ruling for interns Eric Glatt and Alexander Footman on the issue, Judge Pauley found that the interns did not fall within the FLSA’s unpaid “trainee” exception.  Glatt v. Fox Searchlight Pictures Inc., S.D.N.Y., Case No.11-06784 (June 11, 2013). 

Applying Labor Department criteria, the court said the interns did not receive training similar to that in an educational environment, as they performed routine tasks that otherwise would have been performed by paid employees. The court also held that Fox Searchlight was the “primary” beneficiary of the internships.

The court utilized six criteria enumerated in a Department of Labor fact sheet in order to determine whether the FLSA trainee exception should be applied:

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.
6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

The court focused on the first four criteria, as there was no evidence the interns had been promised a job at the end of their internships (criterion 5), and there was no dispute about the fact that the interns understood their positions to be unpaid (criterion 6). However, the court was clear that employees cannot waive their right to the FLSA’s protections by agreement. 

“Considering the totality of the circumstances, Glatt and Footman were classified improperly as unpaid interns and are ’employees’ covered by the FLSA and NYLL,” the court ruled. “They worked as paid employees work, providing an immediate advantage to their employer and performing low-level tasks not requiring specialized training.”

The court also ruled for the interns on their claim that Fox Searchlight was their joint employer based on the company’s level of control over them via film production.