Formerly Homeless Unpaid Intern Leading a Lawsuit Against Warner Music

July 16, 2014 By

Link to Newsweek Article by Zach Schonfeld

Kyle Grant was still living in a Bronx homeless shelter when he started interning at Warner Music Group (WMG) in August 2012. The gig was unpaid, and he couldn’t afford an apartment of his own after moving out of his girlfriend’s mother’s house, but he took it anyway. He’d already worked at JAMBOX Entertainment, a much smaller music production company. He was planning to launch his own record label one day. A stint in Warner’s Music Promotions Department seemed a pretty great way to learn the basics.

But like so many facets of the unpaid intern industrial complex, it wasn’t quite what it appeared.

“As an intern I wanted to do whatever I could to make a name, to at least stand out to somebody,” Grant, now 23, told Newsweek in a recent conversation in a Manhattan law office. “That’s not what happened. It was just a routine of getting things.”

Most days, Grant was expected to fetch drinks for two different vice presidents. He also took lunch orders and took clothing to be dry-cleaned. “Things that have nothing to do with working in radio promotions,” he said. “Oh, man, I even took people’s luggage. When you need to repair luggage and you take it to Louis Vuitton? I was picking out jewelry and things like that.”

Unbeknownst to Grant, a set of federal Department of Labor guidelines—known as “Fact Sheet #71”—stipulates that an unpaid internship must be “for the benefit of the intern” rather than the employer. “The employer that provides the training derives no immediate advantage from the activities of the intern,” the document states, “and on occasion its operations may actually be impeded.” At a for-profit music conglomerate like WMG, operations probably weren’t impeded by an unpaid worker fetching lunch orders.

But Grant’s hours left little time for studying labor policy. He was taking classes at the time, but the internship required well over 40 hours a week, and his GPA soon plummeted.

“I was told if you want to be an intern here, there are small things you’ve got to do,” he said, “like coming in earlier, leaving later, be the first one here, be the last one out, that type of thing.” So he’d arrive by 9 a.m.—he had to make sure coffee was ready for his bosses—and would frequently stay in the office until 8 or 9 p.m. Then he’d return home to the shelter, which he describes as “like a large dorm room of adult homeless people,” including drug addicts and prostitutes.

That schedule posed another problem: The shelter had an 8 o’clock curfew. Often he would arrive home to find a note from the Department of Homeless Services (DHS) threatening to kick him out onto the streets.

“I had a lot of different obligations to deal with, and it kind of felt like they were insensitive to that,” Grant said. “It was like, OK, I’m not getting paid here, I’m here more than freaking paid employees. When I say I have to be somewhere Monday because they’re going to cut off the food stamps benefits I get, you can’t tell me my job is in jeopardy. Which kind of made me fear my job security even more. Which kind of made me want to be there even more hours, because it was like, OK, I called out last week, let me do that much more.”

Those fears turned out to be warranted. Grant worked for about eight months without compensation—an exceptionally long time by internship standards, though he said some interns had been there for three or four years. (“The joke around the label was, ‘Oh, that’s a super-intern.’”)

Then he was fired.

Grant says he was let go for taking too much time for his lunch break. He’d been spending his downtime trying to get the A&R department excited about a band that was doing well in Thailand. He set up a meeting over lunchtime, though he had no regularly scheduled time to eat, and when he got back to his desk, he was told to leave.

So he did what an increasingly sizable number of disgruntled ex-interns have been doing over the past two or three years. He sued.

Grant isn’t the first to cap off an unpaid internship with a class-action lawsuit alleging wage violations instead of the routine employer references. Nor was he the first to take legal action against WMG. A former Atlantic Records intern named Justin Henry targeted WMG, which owns Atlantic, with a proposed class-action lawsuit seeking unpaid wages in June 2013—just two months after Grant’s internship came to an abrupt end.

Henry declined to comment for this article, but court documents obtained by Newsweek suggest his experience wasn’t dissimilar from Grant’s. While interning in the A&R department in late 2007 and early 2008, Henry “was responsible for completing various office tasks such as answering telephones, making photocopies, deliveries, creating lists, preparing coffee, and running personal errands for paid employees,” a statement says.

Grant’s mother learned about the lawsuit on the news and told her son. “I saw who was representing him, and I reached out,” Grant said. Virginia & Ambinder, a lower Manhattan law firm that specializes in labor law, has brought similar cases from former interns against Madison Square Garden, Viacom, Sony, Universal Music and other companies. The firm is spearheading this suit in collaboration with attorneys at Leeds Brown LLP. Soon Grant became the lead plaintiff. “I just knew that I busted my ass for Warner Music Group, and I got fired. I’m entitled to some compensation.”

In May, the suit was granted collective action status. Under the Fair Labor Standards Act, that means the firm now has permission to alert anyone who has interned for WMG in the past three years and invite the person to join the lawsuit. Those interns number around 3,000, the firm says.

WMG has mostly kept quiet. “Given that this is a pending matter, we will let our legal filings speak for themselves,” a representative told Newsweek in a one-line statement. The company’s defense seems to hinge on questioning the commonality of the plaintiffs and arguing that its interns should be classified as “trainees” rather than employees, an exception detailed in the 1947 Supreme Court decision Walling v. Portland Terminal Co. That argument served Hearst well when former Harper’s Bazaar, Marie Claire and Cosmopolitan interns were denied class-action status in 2013.

But will Warner have the same luck? The company is so large that past interns described drastically different experiences from department to department. The one consistency: All who interned in the past decade confirmed that their work went uncompensated, save for the occasional subway fare stipend (about $5, or two subway rides, a day).

For some, the unpaid hours paid dividends.

“Warner definitely opened up so much opportunity for me,” said Dylan Steinberg, a 2007 intern who went on to launch a small video production company. “They had me produce and write a treatment on a band called Shadows Fall. They loved the treatment, and they hired me and my college roommate, and we put together a show package. They somehow trusted me, a college sophomore, with a $7,000 budget.”

Other stories related to Newsweek were less inspiring. One former intern, who worked in WMG’s London office and spoke on condition of anonymity, said she spent every day digitizing hundreds of CDs into a computer database until her eyes hurt from updating the metadata.

“Sometimes for eight hours I was hardly spoken to, as my supervisor was in another room and the employees in the same room were not very willing to talk to me,” the ex-intern wrote in an email. She’d been told there might be a paid gig waiting on the other side, but after two months her boss said that wouldn’t be possible “because a lot of people wished to work for Warner for free.”

The popular wisdom is that those lining up to work for free are children of the wealthy, people who can afford to clock hours without pay. But data compiled by the consulting firm Intern Bridge show that poor and middle-class students are just as likely to land in unpaid internships.

Interns like Grant, in other words. They can’t “afford” to work for free, by any metric. But they’ll do it anyway.

Three years ago, a lawsuit like Grant’s might have been tossed out of court and mocked by the media. So what’s changed?

When the activist group Intern Labor Rights formed in early 2012—put together from the listserv of an Occupy Wall Street working group called Arts & Labor—the proliferation of unpaid internships was widely accepted and scarcely discussed, a relatively obscure concern at the fringes of labor law. As Ross Perlin documents in his 2011 book, Intern Nation, unpaid opportunities have skyrocketed over the past few decades. For companies, that’s particularly tempting during a recession.

But for uncompensated 20-somethings, it means one unpaid gig leading to another leading to another. In the arts and media world, the promise is always the same: exposure, experience and the faint glimmer of a paid gig at the end of the tunnel.

The Baffler magazine called out the increasingly exploitative practice as early as 1997, in “Internment Camp.” But courts and labor policy have only just begun to play catch-up.

The tipping point, experts say, was a high-profile 2011 suit against Fox Searchlight Pictures. Eric Glatt and Alex Footman, the plaintiffs, served as unpaid interns on the set of Black Swan in 2009. The two demanded back wages, arguing that their menial tasks—which mostly entailed fetching coffee and lunch orders—legally classified them as paid employees. They faced ridicule and threats that they’d never work in film again

Then, in 2013 a judge ruled that they should have been compensated as employees, and the floodgates opened. A new flurry of lawsuits arrived: against Condé Nast, against Gawker, against MSNBC and Saturday Night Live. When interns at The Nation decided to write a letter to the editor instead of suing, the magazine owned up and agreed to dole out minimum wage.

“When we filed the lawsuit, the media coverage favored ridicule more than respect,” Glatt said. “[Now] the sentiment has completely changed. The attitude about this has completely shifted. People recognize this is a practice that needs to end. Its time has come. More and more people are experiencing firsthand how dysfunctional this system is.”

Lucy Bickerton, a friend of Glatt’s who filed a similar lawsuit against the Charlie Rose show on PBS, where she interned in 2007, shares the sentiment. That case culminated with a classwide settlement amounting to $250,000, which the plaintiff called “a huge victory.”

“I never really thought it would go anywhere, honestly,” Bickerton told Newsweek. “The fact that it has really managed to do a lot and produce positive results is so heartening and really incredible.”

Doesn’t she worry the lawsuit will brand her as unemployable? She doesn’t: “If anyone has a problem with that as a potential employer, then they’re probably breaking some laws themselves.”

For arts and media organizations, the effects of the great intern revolt, as it’s been dubbed, have been mixed. Companies as high-profile as the New York Times Co. have been successfully pressured into paying all interns minimum wages. Others, like Condé Nast, have responded to lawsuits by doing away with the programs altogether.

But for labor-minded law firms, the results are less ambiguous. This is a burgeoning realm of employment law, and Virginia & Ambinder seems well positioned to take the lead. The WMG suit isn’t even the latest. Since then, the law firm has targeted Clear Channel, Atlas Media and others. Another leading firm, Outten & Golden, has represented suits against Charlie Rose, Condé Nast and Hearst and is reported to have set its sights on Vice Media.

“Our hope with these cases is that companies wake up and start paying their interns and realize the value of interns,” Suzanne Leeds, an associate at Virginia & Ambinder, told Newsweek. “You’re getting people like Kyle [Grant] who are really passionate about the industry, desperate to get their foot in the door. You’re getting really good workers, and they deserve to be paid.”

Meanwhile, the ex-interns themselves have moved on. Bickerton entered a post-bac pre-med program. Glatt just finished up his second year of law school.

More than a year removed from his internship, Kyle Grant has started taking classes again. He has an apartment. He’s building up his homespun label, Live.Out.Ur.Dreams Entertainment Worldwide (L*O*U*D).

He still has his Warner Music badge—a prized possession—but he’s learned not to place too much trust in the unpaid labor economy.

“There’s a lot of people that want to be in the music industry,” Grant said. “And the doors, they don’t really open. When they do, when [they] did for me, it was the biggest opportunity of my life. And it was taken away because I didn’t get people’s lunches promptly or whatever it was.

“That should be fixed,” he said.

Filed Under: Unpaid Internships Tagged With: , ,

Former Intern Files Suit Against Clear Channel

July 16, 2014 By

Link to Newsweek Article by Zach Schonfeld

A former intern for Clear Channel Communications has filed a suit against the massive radio broadcasting company in federal court, alleging that she performed the job of a paid employee in her unpaid internship and should have been compensated as such.

The plaintiff, Liane Arias, worked for Clear Channel’s promotions and marketing department from August through December 2011, during which time her tasks included assembling current events reports and going to giveaways and other events to promote Clear Channel stations.

Now she argues that she—and any other ex-interns included in the class-action lawsuit—is owed back wages under the Fair Labor Standards Act, which sets the terms under which an educational internship can be unpaid.

Court filings obtained by Newsweek claim that Clear Channel’s conduct “has been intentional, willful and in bad faith, and has caused significant damages to Plaintiff and members of the putative class.”

Arias is represented by Leeds Brown Law and Virginia & Ambinder, a Manhattan law firm that has brought similar suits against Warner Music, Sirius, Madison Square Garden, Viacom and other companies. Last week it also filed cases against Atlas Media, Coach Inc., UBS Financial Services and several other companies.

LaDonna Lusher, a senior associate at Virginia & Ambinder, said the suit is similar to others the firm has been involved with recently.

“We’re representing them because they did the work of paid employees and were unpaid,” Lusher told Newsweek. “They didn’t get any sort of wage or stipend as far as we know.”

These lawsuits all come in the wake of a federal judge’s ruling in 2013 that two unpaid interns on the set of the film Black Swan performed the work of paid employees and so should be subject to minimum wage laws. That decision marked “the first major ruling on the illegality of unpaid internships in recent years,” ProPublica reported at the time.

Clear Channel did not respond to a request for comment.

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Who’s Really Paying The Price Of Unpaid Internships

June 5, 2014 By

Link to Forbes Article by Natalie Sportelli

Graduates of the class of 2014 were recently handed the most expensive sheet of paper they will ever own—a college diploma. Along with earning their degrees, college students today are expected to graduate with work experience on their resumes, primed and ready for the job market. Undergrads can find resources to offset the cost of their college education, including financial aid and student loans, in order to work towards their diplomas. But, where can students find the capital to fund the work experience needed to qualify for a job after school gets out?

Undergrads lucky enough to land paid internships can use their paychecks to cover the costs associated with taking the job, including food and rent if they need to relocate from home to a different city. Conversely, students who accept unpaid or underpaid internships must find some means of financing the cost of taking the job—who pays for these unpaid internships?

Finding funding

According to data from the National Association of Colleges and Employers (NACE), nearly two-thirds of graduates from the class of 2013 had internship experience on their resumes when they entered the real world. Of the 63.2% of seniors who had been hired as undergrads, 47.8% had taken part in unpaid internships.

Unless students find some kind of external funding source, they are looking at paying out of pocket to cover the price tag of unpaid work experience. Students may choose to work on the side or ask their families for a loan in order to afford to take the job. But, these options may not be available for interns working full-time who cannot juggle a second job or those whose families cannot afford the additional expenses.

Students seeking funding for their summer job need not go far to find it. Colleges and universities have started gearing their career services programs towards helping students cover the costs of their unpaid or underpaid internships. Many universities have information about how to finance unpaid internships on their career services websites, highlighting career or major-specific scholarships and grants offered through the institution.

ROI all around

Summer internship funding for students, sponsored through their college or university, is a win for both the student and the higher education institution because the student can afford to take an unpaid internship that will help his or her career prospects, and the college can showcase its ability to prepare its undergrads for the job market to prospective students.

Elite higher education institutions, including Colgate University, Duke University, and Tufts University offer internship grants, funded by alumni and/or donations, directly through their centers for career services. Eligible students complete application forms or conduct interviews and, if approved, the office allocates money to the applicants. Some applications include caveats like a threshold for student GPA or proof of a formal internship offer, while others allow students to apply for funding before beginning their job hunt.

Getting your tuition’s worth

Prospective students may now have another factor to consider while deciding between colleges: how will this institution not only give me a first-class education, but how will it also literally enable me to get a job.

Universities that are leading the trend towards funding summer internships may soon see their investment pay off in increased applications from high school students seeking to find a college that will not only get them ready for the real world, but also get them through the door of their first job.

Filed Under: Unpaid Internships Tagged With: , ,

Maggie’s Farm? Internships under scrutiny…

May 27, 2014 By

Link to The Monitors Article By Nicholas Burman

The internship: the pain of many post-graduates, and the basis of a two hour advert for Google masquerading as a film. Whatever the context, the subject always seems to be met with a slight, “oh well, that’s the way it works, so you know, deal with it…” attitude. That approach changed in the UK slightly last year as new legislation was brought in to criminalise unpaid work, but the issue has picked up considerable steam again recently with the news that up to 3,000 ex-interns might file lawsuits against Warner Music.

The argument about internships ties in with wider social issues surrounding youth unemployment, which is still close to a fourteen year peak. Len McCluskey, leader of Unite, told The Mirror that the thrust of government policy “is towards a low waged economy where insecure employment is rampant. We can’t tolerate an economic landscape that offers precious little hope of real jobs for our young people.” Internships are part and parcel of employment culture in the ‘media’ (TV, film, music, fashion, etc.) especially, as anyone who’s aimed to work in the creative industries over the past few years can attest to. And while the apprenticeships scheme is going strong (in the 2012/2013 period there were 510,000 apprenticeships available), for most people wanting work in the sector it can still feel like an uphill struggle.

There are clear benefits to internships, in the sense that they exist to give experience and on-the-job training for jobs which, for subtle reasons, are difficult to teach in an academic setting. The idea in itself that an education system should exist purely to deliver people into the workforce is pernicious for the generations of young people who expect to go to school to actually learn stuff, but ultimately people need to pay their rent, and on-the-job experience helps you work out if you are actually interested in that career in the first place. If you’re any good and opportunities arise then you might just be one of the lucky few to bag a career in a typically hard-to-get-into industry which, as it starts to grow faster than many other creative micro economies, sees competition grow even faster. So, the system has to get people into work, and until Revolution Russell Brand becomes a reality that’s the way it’ll continue.

A big negative of unpaid internships (apart from the fact that people aren’t paid) is the argument that by being unwaged the only people who can really afford to take them either already live in areas where these industries exist (largely the South East) or have backgrounds where their families can assist them with money (because of the imbalance of wealth, this also tips opportunities in favour of the South East). AsDavid Dennis has argued in The Guardian, this means only the privileged few can realistically aspire to become involved with industries such as journalism. The fact that the Government had to make clear last year that unpaid internships are illegal under employment laws really makes little difference to the overall attitude towards work which currently seems to exist (the phrase ‘you’re lucky to have a job’ being an example of a culture that sees the necessity to exist as a privilege and not a right). Many smaller companies take on interns and train them up and bring them into the fold once they grew, but there are also examples of very rich companies not paying people just out of principle, very rich companies like the ones Tony Blair runs (odd that a multi-millionaire whose Government introduced the minimum wage sees fit to ignore it).

The reason this has become a talking point again recently is because of a lawsuit filed by a Mr. Kyle Grant against Warner Music Group. As reported by multiple sources including HUH, “The Warner Music Group are facing a major lawsuit at the hands of 3,000 former interns. Sparked last year by ex-intern Kyle Grant, the lawsuit alleges that Warner routinely abused interns by having them mainly carry out basic tasks such as fetching coffee and grabbing lunch for the paid employees. This amounts to no music industry experience or educational value whatsoever, which is a requirement for unpaid internships.”

In the US, unpaid corporate internships have long been established, but the government’s compliance rules are very definite. You have no real control on the nature and scope of work you will be required to perform as part of the corporate internship program, even if you intern as part of a higher education curriculum to gain course credits toward your final degree. The point is that if the company fails to provide a structured educational experience, and instead requires you to perform the actual work of paid employees, however menial or complex, then you should be classified as a compensated employee, and paid at no less than federal minimum wage (which is $7.25/hour). Generally, for the corporate unpaid internship programme to comply with government regulations, the interns should almost be a hindrance, with most office time devoted to learning from witnessing and shadowing rather than actually performing routine tasks normally performed by paid employees.

The law firm of Virginia and Ambinder LLP represents plaintiff Kyle Grant in the class action against Warner Music Group and Atlantic Records Corporation. Recently the judge in this case issued a decision which will allow Grant to send a notice to over three thousand former interns notifying them of a right to participate in the case. I talked to one of the partners of the firm, Lloyd Ambinder, about the lawsuit. He informed me that students is the US often pay as much as $50,000-$60,000 in annual tuition, just for the opportunity to participate in a corporate unpaid internship program.

“Very often unpaid interns devote most of their time performing menial office tasks such as answering phones, running errands for managers, performing data entry, cleaning the office refrigerator, making photocopies and performing other tasks normally reserved for entry-level compensated employees. All too often, colleges accept the tuition payments but perform little or no monitoring to ensure that the intern is receiving a true educational experience rather than just ‘doing a job’.”

At the end of the day, colleges are complicit in this exploitation, since the school receives tens of thousands of tuition dollars from students who do not attend classes while performing unpaid internships. Other companies which have been sued by unpaid interns alleging the same offences as Mr. Grant include Sirius Radio, Viacom, Donna Karan, Conde Nast, Hearst Publications and Sony. To date, some of these intern cases have ended with the parties agreeing to an out-of-court settlement, while other cases continue to be litigated in the courts. I asked Lloyd whether he thought there was any way around the unpaid internship compliance problem, and for ways to move forward. His reply was: “Simple. Pay them.”

In Britain, apprenticeship schemes serve as a halfway house between education and paid work. Businesses use organisations like recruitment agencies to find suitable candidates for an apprenticeship position, essentially ‘learning on the job’, so work that benefits the company can be carried out while the apprentice involves themselves much like any employee would, depending on what they’ve been hired to do. Once a month an assessor comes to the workplace to check on how both parties are doing and ensure that certain criteria are being met. If all goes according to plan, the apprentice should come out of the process with aNVQ. Programs for media-orientated companies to get on board are available, such as UK Music’s push to bring young people into the music industry (with companies such as Liverpool-based publisher Sentric Music involved in the scheme). There are also less official apprenticeship schemes conducted by other companies, that act as a sort of internal enrollment model based on minimum pay in return for their support as educators in a sector.

In France, universities sometimes implement internships as part of higher education courses. When you do an internship for this reason you must sign an agreement between the university, the company, and yourself to be protected. If you do an internship in France for longer than two months, the company has to pay you a minimum (about 430 euros), while if it is less than two months they don´t have to pay you. However, if you do an internship abroad it’s different because the rules of the host country are applied. In this instance the university can take you through a process of receiving a grant.

There are three main companies that offer these funds. The first is the AMI/BMI, for students who already received money for the year to help them, with the CROUS (a regional organization providing student bursaries and university halls of residence) giving this money to students. ERASMUS is for internships in the European Union, with the Agency 2e2f providing the money. The final option is JALI, a support group for internships outside of the European Union and also for internships which are optional (not obligatory as part of a university course). In this case it’s the region where you are studying which gives the money to you. Whether you receive a grant for a course depends on whether the university agrees that the internship is worthwhile as part of your course and whether the funding organisation agrees.

Marion is a French student currently taking advantage of this scheme during an internship in London. “In general, I think it is a good system, maybe too good! [… For this year] CROUS created a new level of support to raise the number of students who can have help. I never saw people who were disappointed about it. In general they try to help everybody if they need money for their internship […] They try to give the right support. They adapt it on each project. […] I think we have a good system in France compared to other countries which don’t help students.”

One way to get people into work is to move the work to them, which was the idea behind Salford’s Media City, which saw large parts of the BBC transfer over to the Manchester borough. However, when mismanaged it can create a bit of disillusionment amongst the new locals regarding how many opportunities are brought into the area, such as when the Manchester Evening News reported that only 246 out of 600 new jobs created by the arrival of Media City were given to people living in the Greater Manchester area (with up to one hundred apprenticeship schemes also due to be created within the organisation). There has been some even more pessimistic reporting of the organisation’s arrival on the doorstep of Salford residents, but there’s also been plenty of positivity about the ensuing diversification of the market that can occur as a result of making such big corporations more regional.

The higher education website Study London says, “Did you know? London was voted the most cost-effective city in the UK for students. With so many part-time jobs available, you can support your studies and enjoy London life while you study. Plus you’ll have great work experience to add to your CV.” Theoriginal study they’re referring to made the claim based against a student loan combined with part-time work (not that useful a measurement in a declining jobs market), saying that they’d earn (on average) £5,024.40 a year. While students build up debt in the UK during studying, limiting their resources after graduating, the costs to live in London as a student (minus the tuition fees) can be up to £1,020 per month. If you doubled that to make it full-time work, earning post-grads £10,048.80 year, you’d still be struggling to pay the average monthly rent of a one-bed flat in zone two or three, where costs can be up to £1,000, or as ‘little’ as around £750 (via London.gov). You suddenly see a vast gap in between earnings and the ability to live in the capital, with gentrification, regeneration and commercialisation all playing a role in house prices and the jobs market.

Industry and state have to work together to solve the issues surrounding this area. Government should assist people during times when they don’t have the capacity or the capital to help themselves, and to pay for it big corporations should be paying full UK tax. Big corporations should also be more willing to part with a little bit of cash to help build a trained workforce. People should do what their interests and their natural skill sets lead them to, and the best person for the job should be the person that’s hired. Opportunities should be made equal for all or otherwise disadvantaged people will become excluded further and further from jobs which help shape the culture of the arts and media, homogenising culture and its industries in the process.

Filed Under: Unpaid Internships Tagged With: , ,

Ex-Warner Music Group Interns Clear Hurdle in FLSA Case

May 16, 2014 By

Link to Law.Com Article By David Bario

How's this for a bummer? Work from 9:30 a.m. to 8 p.m., five days a week, answering phones and making coffee and copies in a Manhattan office. Oh, yeah, and there's no pay, no career training and no academic credit.

That's how Kyle Grant allegedly spent nine months in 2012 and 2013, working at Warner Music Group’s Warner Bros. Records unit. Why Grant would exhaust almost a year of his young life this way is anyone's guess, but for employers the important thing is what he chose to do next. Last summer, Grant hooked up with one of the plaintiffs firms behind a growing wave of employment class actions in New York federal court, claiming that WMG violated the Fair Labor Standards Act when it failed to pay him and about 3,000 other ex-WMG interns for their work.

The case passed an early test on Tuesday, when U.S. District Judge Paul Gardephe agreed to send class notices to former interns who worked at WMG or its subsidiaries from June 2010 to the present. Gardephe ruled that the former interns were “similarly situated” enough to warrant notifying potential opt-in plaintiffs about the suit. The judge rejected arguments by WMG’s lawyers at Vedder Price that the company’s intern programs were too varied for class treatment, though WMG can still raise that defense as the litigation plows ahead.

Lawyers at Virginia & Ambinder and Leeds Brown brought the case in June 2013, alleging that WMG, its Atlantic Recording Corporation unit and other WMG subsidiaries broadly violated FLSA minimum wage and overtime rules in their internship programs. Last month the same plaintiffs firms won conditional certification of a parallel FLSA class action against Viacom Inc. Vedder Price also represents the defendants in the Viacom case, which is pending before U.S. District Judge Jesse Furman.

So far the momentum in the intern litigation has been with the plaintiffs, who have grown more numerous ever since U.S. District Judge William Pauley III ruled in June 2013 that former unpaid interns at Fox Searchlight Pictures Inc. qualify as employees under the FLSA and New York labor laws. That decision followed a major setback for the plaintiffs in a similar case against Hearst Corporation in May 2013, when Hearst's lawyers persuaded U.S. District Judge Harold Baer to reject ex-interns' class claims.

The Fox and Hearst cases are now being considered in tandem by the U.S. Court of Appeals for the Second Circuit, which has yet to set a date for oral arguments. Not surprisingly, the amicus briefs have been pouring in, with everyone from the U.S. Department of Labor to the U.S. Chamber of Commerce pointing out that the stakes are huge for employers and employees alike. Outten & Golden’s Rachel Bien is representing the plaintiffs in the consolidated appeals. The defendants are relying on Proskauer Rose (for Fox and Hearst) and Neal Katyal of Hogan Lovells (for Fox).

We reached out to Laura Sack at Vedder Price to ask about Tuesday’s WMG ruling, but we didn’t hear back. Lloyd Ambinder, who represents the plaintiffs, also wasn't immediately available to comment. Another lawyer at Virginia & Ambinder, LaDonna Lusher, noted that the firm is also pursuing similar cases against Sony Corporation, Columbia Recording Corporation, and other employers.

For a list of all the major intern class actions and their status, check out this handy chart from ProPublica.

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Former Howard Stern Intern Sues Sirius XM Over Unpaid Internships

May 1, 2014 By

Link to Huffington Post Article by Dave Jamieson

A former intern for The Howard Stern Show has sued the radio personality’s broadcaster, Sirius XM Radio, claiming that the company’s unpaid internship program violates labor law.

In a complaint filed in federal court last week, Melissa Tierney says she interned at Stern’s show for five months in 2011, spending between 24 to 36 hours per week running errands, reviewing news clips and fetching food for on-air personalities and guests. She said she wasn’t paid at all for her time.

Tierney argues that Sirius XM cut its labor costs by wrongfully classifying her as exempt from minimum wage protections. Her lawsuit is a proposed class-action that, if given the green light by a judge, could cover other unpaid interns at the satellite radio provider stretching back to 2008.

Sirius XM “would have hired additional employees or required existing staff to work additional hours” had the company not had unpaid interns like Tierney, the suit alleges. Tierney made her claims under federal and New York State minimum wage laws as well as a New York ordinance on wage theft.

Tierney and a Sirius XM spokesperson didn’t immediately respond to requests for comment on Tuesday. According to the Sirius XM website, its internships are unpaid and available only to enrolled college students who will receive credit.

Lawsuits over unpaid internships have become common in the New York media world. A former Harper’s Bazaar intern sued the Hearst Corporation in a high-profile class-action in 2012. The magazine group Conde Nast, owner of The New Yorker and Vanity Fair, announced last year that it would shut down its internship program after it was sued over pay. The company recently settled the lawsuit for an undisclosed sum.

The lawsuits have helped kick off a lively debate over the use of unpaid interns, a practice that many people argue closes the media and policy spheres off from those of lesser means. Students and recent college grads from upper- and middle-class families are far better equipped to spend several months in an expensive city like New York or Washington while not earning any money.

The question of whether or not individual programs violate the law has been left up to judges. The U.S. Labor Department has issued guidance to help employers determine whether or not their interns need to be paid under the Fair Labor Standards Act. The cases largely hinge on who benefits more from the intern’s time — the intern or the company — and how much the intern can reasonably be expected to learn from the experience.

As HuffPost reported Monday, even the White House has come under fire for its unpaid internship program, which brings an estimated 300 students and recent grads to Washington each year. Government offices are exempt from the rules covering when an internship must be paid, making the White House’s program perfectly legal, although worker advocates say the White House should lead by example and start paying its interns.

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Paid Internships Benefits Interns and Employers

April 24, 2014 By

Link to USNews Article By Lloyd Ambinder and LaDonna M. Lusher

Even before the onset of the 2008 recession, college students and recent grads eagerly, if not desperately, sought out unpaid internships hoping to gain the necessary experience to land a paid job. Unfortunately, rather than provide a structured educational environment for interns, many, if not most, employers treat interns like entry level employees without providing them any compensation. In the end, rather than acquiring critical experience helpful to starting their career, most often these unpaid interns end up doing menial work like cleaning the office refrigerator and running personal errands for their supervisors. All the while their colleges and universities continue to charge thousands of dollars in tuition for academic credit, while providing little or no oversight of the interns’ activities.

While it is not per se illegal for employers to provide unpaid internship programs, perhaps it is time to make such programs unlawful. Many unpaid internship programs do not come close to satisfying the U.S. Department of Labor’s six-factor compliance test that would render them legitimate. Complying with the test is likely to prove burdensome and inefficient for most employers, particularly since a basic tenet prohibits interns from performing work that would benefit the employer or would serve to displace another compensated employee.

A common sense balance would be to compensate interns in a work environment that provides on-the-job training, thereby benefitting the employer and the intern. Employers would be free to utilize interns as they see fit, and take advantage of their talents by having them perform substantive work instead of menial tasks. Employers could further assess the interns work performance and potential for full-time employment without being subject to oversight by the DOL.

Companies such as Viacom, Sony, Madison Square Garden, Donna Karan and Warner Music Group, all of whom are currently facing lawsuits brought by unpaid interns, could have avoided the expense of litigation and eliminated exposure to liability by simply paying their interns at least minimum wage (currently $7.25 per hour under federal law). Those employers, some of whom allegedly required their unpaid interns to perform such tasks as getting coffee, making copies and picking up supervisors’ prescriptions, could have compensated their interns and directly benefited from the work and skill set the interns offered.

The interns would also benefit from mandatory paid internships because they would receive an actual wage for any variety of tasks they are required to perform. Studies show that, while nearly half of all graduating college students have performed some kind of internship, those fortunate enough to land a paid internship are more likely to gain a full-time job offer or higher starting salary than those who complete an unpaid internship. And those who perform an unpaid internship do not fare any better in finding paid employment than individuals who do not participate in any internship program at all. Offering at least minimum wage to these highly motivated and educated individuals would provide further incentive for them to work even harder to gain full-time employment.

The economy also benefits from paid internships, which generate millions of dollars in taxes and revenue to state and federal governments by requiring employers to pay minimum wages, overtime, payroll taxes, unemployment insurance and workers’ compensation. Paid internships also increase the number of paid entry-level employment positions, resulting in a decrease in the unemployment rate. Interns who are compensated also face a lesser financial burden than those who are forced to accept an unpaid internship and simultaneously work a paid position, or borrow money, simply to make ends meet. Mandatory paid internships would also generate competition amongst businesses competing for talented new recruits, and result in higher salaries for entry-level employees.

Finally, requiring employers to pay interns a minimum wage promotes the underlying remedial purposes of the Fair Labor Standards Act, which was enacted by Congress to protect workers from detrimental labor conditions and ensure payment for work performed. Conversely, encouraging employers to offer unpaid internships results in paid employees being replaced by unpaid interns, a reduction in the number of paid employment positions, and the elimination of fundamental workplace rights.

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Colleges, Employers Rethink Internship Policies

April 23, 2014 By

Court Cases, Legislation Spur Some Companies to Drops Programs; Others Introduce Pay

After a string of high-profile lawsuits, schools have tightened policies for posting summer interns. Conde Nast and other firms have eliminated their internship programs entirely, making for even tougher competition for the positions that remain. Rachel Feintzeig reports on the News Hub.

The rules have changed for summer interns.

Since last year’s class vacated the lowest rungs of the corporate totem pole, a string of high-profile lawsuits by unpaid interns has worked its way through the courts, and legislatures have passed new protections, forcing both schools and employers to rethink their policies.

Some companies are moving toward paid programs. Others, like magazine publisher Condé Nast, are getting rid of internship programs altogether. The pressures could result in better pay and educational experiences for interns who win the coveted openings—but fiercer competition for the spots that remain.

In recent years, internships have become a near-necessity for college students trying to stand out in a brutal job market. And while some positions can provide valuable work experience and a glimpse into corporate life, critics maintain that the stints often amount to little more than unpaid labor.

A survey last year from the National Association of Colleges and Employers suggests unpaid internships don’t help students land full-time jobs. Alums of unpaid internships had full-time job offers at nearly the same rate as those who had no internships at all—about 37%, compared with 62% for those with paid internships.

School officials say they are increasingly looking to protect students from subpar internships. In February, Columbia University stopped giving students special credit on their transcripts for internships. New York University now requires employers to click a button certifying their internship measures up to Department of Labor guidelines before posting it on the school’s careers website.

And Hamilton College, in Clinton, N.Y., won’t post openings for unpaid positions from companies that they know also offer paid internships.

“It’s clear, in the last year, that colleges and universities have begun to individually and collectively come up with a voice on this,” says Mary McLean Evans, assistant vice president and executive director at Hamilton’s career center.

NYU was galvanized, in part, by a petition started last year by third-year student Christina Isnardi. The 20-year old felt “exploited” after spending the summer of 2012 as an unpaid intern on a film produced by Lions Gate Entertainment Corp. She said she sometimes worked 16- or 17-hour days, taking breakfast orders for the cast and crew or watching equipment far from the film set.

A spokesman for Lions Gate declined to comment.

“There are hundreds of students who are sick of this,” Ms. Isnardi said. “We just feel as though our dreams are holding us hostage to this unfair, unethical labor practice.” Her petition gathered more than 1,000 signatures.

State and local governments also have taken up the cause, pushing in recent months for fresh intern protections.

New York Mayor Bill de Blasio signed legislation last week extending the city’s employment discrimination laws to interns, including those who are unpaid. A similar bill won unanimous support in the California State Assembly’s judiciary committee Tuesday. And Oregon last year passed a law extending discrimination benefits to all interns, while Washington, D.C., did so in 2009.

The developments are having mixed effects on employers.

Viacom Inc., facing a lawsuit brought by former MTV interns, made its hundreds of internship positions paid starting last summer, said spokesman Jeremy Zweig. Before, practices had varied, he said.

LeanIn.Org, the nonprofit group founded by Facebook Inc. FB -2.35% Chief Operating Officer Sheryl Sandberg to further women’s career ambitions, came under fire in August after advertising for an unpaid intern; the incident prompted the organization to start a paid program, according to a spokeswoman.

A suit against Condé Nast, which involves former interns at W Magazine and the New Yorker, is currently in settlement talks, according to the plaintiffs’ lawyer. Condé Nast declined to comment on the suit or whether it had any plans to revive its internship program.

Jay Zweig, a Phoenix-based managing partner at Bryan Cave LLP, said he is aware of “dozens” of companies that have walked away from unpaid-internship programs, dropping students entirely rather than creating paid positions. (Arizona’s minimum wage is $7.90 an hour.)

Though there are fewer positions, Mr. Zweig says he thinks the internships that do exist are more substantive. “They’re not just being hired on as unpaid labor doing menial tasks,” he said.

At for-profit companies, 38.2% of interns didn’t get hourly wages, according to a 2012 survey of more than 11,000 students by research group Intern Bridge.

The Fair Labor Standards Act says that unpaid internships shouldn’t be for the direct advantage of the employer, should benefit the intern and be educational, and must not displace regular employees.

One spark for the firestorm over internships was a June ruling by a federal judge that 21st Century Fox Inc.’s Fox Searchlight Pictures violated minimum wage and overtime laws for not paying interns who worked on the film “Black Swan” doing the same tasks as paid employees. Until last year, 21st Century Fox shared a parent company with The Wall Street Journal.

In November, Fox was granted the opportunity to appeal the suit’s class certification and summary judgment, which went in the interns’ favor, to the Second Circuit Court of Appeals, where it is now pending.

A Fox representative declined to comment on the suit, citing the continuing litigation.

That lawsuit has opened the floodgates. Lloyd Ambinder, partner at New York-based Virginia & Ambinder LLP, which is representing unpaid interns in suits against Warner Music Group Corp., Viacom, Madison Square Garden Co. and other employers, says he has spoken to or met with at least 40 to 50 interns in the past month.

His office will have some help handling the caseload: Ms. Isnardi, the NYU student, landed a summer job there. It is a paid position.

Article on The Wall Street Journal By Rachel Feintzeig and Melissa Korn

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Federal Judge in Manhattan Conditionally Certifies Class of Unpaid Interns at Viacom and MTV

April 7, 2014 By

New York NY – A New York federal judge granted conditional collective certification status Friday to former interns at Viacom and MTV who claim to have been denied proper wages as required by state and federal law.

In a decision published Friday, U.S. District Judge Jesse M. Furman approved procedures to allow the participation of all current and former Viacom and MTV interns who worked for the media giants since April 4, 2011. Judge Furman granted plaintiff Casey O’Jeda’s request to allow potentially thousands of other interns to receive notice of and participate in the case based on allegations that Viacom and MTV violated federal and state labor laws for not paying their interns.

“We are glad that Judge Furman saw that the unpaid internship policies that existed for Casey [O’Jeda] existed throughout the company and throughout the country. This isn’t an isolated situation. We believe there was a uniform policy and practice that existed in this enormous company where workers were not paid any wages and were taken advantage of,” said Lloyd Ambinder, of Virginia & Ambinder, LLP, who along with Leeds Brown Law, P.C., represents O’Jeda and other interns in the matter.

O’Jeda, an unpaid intern during the Fall and Winter of 2011, originally filed the case in August 2013 in a wave of collective and class action cases that were brought pursuant to the Fair Labor Standards Act and New York Labor Law alleging that unpaid internships violated numerous state and federal laws. According to court filings, O’Jeda was paid no wages for nearly five months worth of work he performed in Viacom’s Mobile Development Department and attended orientation with hundreds of other interns who were similarly unpaid. The lawsuit and court filings allege that O’Jeda performed work nearly identical to that of other paid employees and received little to no educational benefit from the experience.

“There are lots of other interns that will step forward because of a decision like this,” said Jeffrey K. Brown of Leeds Brown Law, P.C. “The judge found that there were other interns who were similarly situated and might have their rights affected by this case as it moves forward. We hope that this encourages workers to stand up for their rights to receive a wage for the work that they perform and the benefits they provide to companies.”

Pursuant to federal law, Judge Furman’s decision allows the circulation of notice to other workers granting them the right to join the case as it moves forward. This is the third high profile internship case to reach this stage of litigation. The other two cases are presently on appeal to the Second Circuit Court of Appeals regarding the requirements for an unpaid internship to be deemed legal or illegal.

“We hope this decision allows other workers whether at MTV or Viacom to step forward and seek a remedy to this alleged wrong,” according to Ambinder. “Unpaid internships disadvantage hard working individuals who are trying to get ahead and gain experience.”

“This is a big victory for our clients obviously, but it is also a big victory for workers’ rights, especially for unpaid interns,” according to Brown. “Allowing this case to proceed as a collective action gives strength to these workers to stand up together and say that they were disadvantaged.”

The case pending in the Southern District of New York is captioned O’Jeda v. Viacom, Inc., MTV Networks Music, MTV Networks Enterprises, etc., 13-CV-5658(JMF).

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Madison Square Garden Intern Lawsuit Could Create Disastrous Precedent For Sports Industry

September 19, 2013 By

Madison Square Garden (MSG) has become the latest company to be targeted in a class action by former interns. Unpaid MSG interns are claiming they were wrongly classified to avoid being paid. The lawsuit claims that MSG used titles such as “intern” or “student associate” when hiring college students to do work which would otherwise qualify them as employees. The class action is estimated to include more than 500 individuals. It has been alleged that these so called interns were asked to work as many as five days a week. They helped support MSG ticket and sponsorship sales, administrative projects and logistics pertaining to the organization of sports and entertainment events at the arena, all tasks that would have been performed by an employee. The suit is seeking damages to cover unpaid wages for misclassified workers stemming back to 2007. Full article.

A six-part test outlined by the Labor Department for determining whether an internship can be unpaid has been used to determine whether an unpaid internship is legal. The following six criteria must be applied when making this determination:

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

Leeds Brown Law PC dedicates a large portion of its practice to the area of employment discrimination. If you worked as an unpaid intern and you believe your rights have been violated, it is important to contact an experienced attorney immediately to preserve your rights. The firm has represented individuals throughout Long Island and the New York City area in matters of wage and hour law. For more information, contact Leeds Brown Law at 1-800-585-4658 for a free consultation or visit leedsbrownlaw.com.

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