Working Students & Labor Laws

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Does Your Unpaid “Working Student” Expose You to Liability Under the Fair Labor Standards Act?

Many of the best and most successful trainers utilize “working students”, and more often than not, these trainers have at one point been a working student themselves. Working students are viewed as a critical component of the equine industry, the positions are often highly coveted and competitive to obtain, and they leave the student with an invaluable experience that prepares them for the equestrian “real world”.

These positions typically require long hours of physically demanding work in exchange for little to no actual monetary compensation. A working student may be charged with general farm labor, including feeding, cleaning stalls, tacking horses, cleaning tack, administering medication, grooming, wrapping legs, and general horse care, in exchange for learning the ropes of running a professional horse training and showing operation. Most working students apply for these positions to obtain pertinent experience in the horse training industry, as well as to learn new skills as a rider.

The trainer gets cheap or free labor in exchange for offering a steppingstone to a future career in the industry for the working student.

A win – win, right?

The Fair Labor Standards Act (FLSA) may not think so. Generally, the FLSA requires “for-profit” employers to pay employees for the hours they work. Interns and students, however, may not be considered “employees” under FLSA, in which case FLSA does not require compensation for their work.

You may be thinking, OK, I’ll just call my working student position an “internship” then, and I’m good, right?

Not so fast. No matter what the trainer and working student call the relationship, the law may view it otherwise which can expose the trainer to liability under state and federal wage and hour laws. In order to determine whether an intern or student is, in fact, an employee, the courts have created a test called the “primary beneficiary test”. This test examines the “economic reality” of the intern-employer relationship to determine which party is the “primary beneficiary” of the relationship and includes the following 7 factors:

Primary Beneficiary Test Factors

The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee.

The extent to which the internship provides training that would be similar to that which would be given in an actual educational environment, including the clinical and other hands-on training provided by educational institutions.

The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.

The extent to which the internship accommodates the intern’s academic commitments by corresponding with the academic calendar.

The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.

The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.

The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.

No single factor is determinative, and courts have described the primary benefits test as a flexible test. Each relationship is unique, so whether an intern or student is an employee under FLSA will depend on the circumstances of each case.

For guidance on whether your working student will be considered an intern under FLSA or if you are a working student and believe you may be owed back pay for wages, consider speaking with a knowledgeable attorney licensed in your state.

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