- An unpaid hospital intern whose internship was terminated early was unable to establish she was an "employee" protected by Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act (ADA), and the Age Discrimination in Employment Act (ADEA), the 10th U.S. Circuit Court of Appeals has ruled (Sacchi v. IHC Health Services, Inc., No. 18-4027 (10th Cir. Mar. 26, 2019)).
- The intern received no payment or benefits, but argued she was an employee because internship would allow her to satisfy a requirement relating to her professional certification and would help provide her a pathway to employment.
- The 10th Circuit rejected the intern's claim that she met the "threshold remuneration" test, a standard that can render an unpaid position protected by federal law. Because the claimed benefits were attenuated, not provided directly by the hospital, and did not resemble traditional employment benefits like a pension or insurance, she was not an employee, it concluded.
In several circuits, unpaid positions are occasionally treated as employment for purposes of federal anti-bias laws if the person working receives a certain level of "threshold remuneration" — either direct pay or indirect benefits that are "substantial or significant and not incidentally related to advancing the purpose of the putative employer," the Sacchi court explained.
The 10th Circuit said it knew of no cases where only a professional certification and "pathway to employment" satisfied this test. It cited as a contrary example a 4th Circuit opinion allowing a volunteer firefighter to continue with claims because she received many substantial benefits, including a state-funded disability pension, survivors' benefits, group life insurance, coverage under the state workers' compensation law and tuition reimbursement.
Notably, California specifically protects unpaid interns and volunteers from harassment under its state Fair Employment and Housing Act, and similar protections may be on the way elsewhere. In January, a small group of lawmakers introduced H.R. 134, the Unpaid Intern Protection Act of 2019, which would make it illegal to discriminate against an unpaid intern on the basis of race, color, religion, sex, national origin, age or disability.
Contingent workers are similarly excluded from many federal employment law protections, but this, too, may be changing. In late 2018, Google's "shadow workforce" — comprising temporary, vendor and contract workers — published an open letter to Google CEO Sundar Pichai. The letter claimed they were denied access to critical communication and treated unfairly. As the gig economy continues to grow and evolve, workers in nontraditional arrangements may increasingly demand more robust legal protections.