Legal Ethics

Law firms may bill for work of unpaid interns, ethics opinion says

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a bill in an envelope

Some labor and law-student groups are criticizing a New York ethics opinion that says law firms may bill clients for the work of unpaid student interns.

The Committee on Professional Ethics of the New York State Bar Association issued the opinion in March, the New York Law Journal (sub. req.) reports.

The ethics opinion said a law firm using interns that receive academic credit, but no pay, may bill for the interns “provided that the client has been advised of the firm’s intent to charge for the intern’s services and the basis of the charge (e.g., per task or per hour or some fraction thereof) and provided, further, that the fee is neither excessive nor illegal.”

The opinion adds that the internship program must comply with applicable law and the intern’s school must not object to the charges.

The opinion says it is interpreting lawyer ethics rules, and not applicable labor laws. It notes that U.S. Department of Labor standards regarding interns were rejected last year by the New York-based 2nd U.S. Circuit Court of Appeals.

The 2nd Circuit decision, Glatt v. Fox Searchlight Pictures, said the proper test for determining whether interns should be paid was whether the internship primarily benefited the employer or the interns. The court ruled in a case brought by interns who worked on Fox’s Black Swan movie.

Several groups signed a letter (PDF) to the New York Law Journal calling the ethics decision “fundamentally flawed” and asking the ethics committee to reconsider. Among those signing the letter are the American Federation of State, County, and Municipal Employees; the NYU Black Allied Law Students Association; the NYU Latino Law Students Association; NYU Law Students for Economic Justice; and the National Employment Law Project.

The letter says law firms that bill for unpaid interns derive “a substantial and direct economic benefit,” and the internships probably wouldn’t comply with the standard set by the 2nd Circuit.

“More broadly,” the letter says, “the opinion fails to consider the circumstances of most unpaid legal internships and the important moral questions they raise. As many have documented, law students today are burdened with enormous debt, stemming from the unprecedented cost of undergraduate and law school education. At the same time, entry-level, paid jobs are scarcer than ever. Students who cannot afford to work for free, including many students of color, either must forgo unpaid internships and lose out on the networking opportunities they offer, or take on more debt in order to intern unpaid. …

“Private law firms, which undoubtedly have the resources to pay interns the minimum wage (currently $9/hour in New York), should not contribute to these hardships.”

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