We are paying close attention to employers who skirt the FLSA by failing to pay so-called "trainees" overtime. The Fair Labor Standards Act (FLSA) defines an "employee" as "any individual employed by an employer." To "employ" is defined as including "to suffer or permit to work." These definitions are intentionally broad in order to provide expansive protection under the FLSA.
In keeping with the FLSA's far-reaching intentions, the Department of Labor's Wage and Hour Division has promulgated a six-part test to determine whether trainees are in fact employees under the Act. Unless all six factors apply, a trainee is an employee under the FLSA. The six enumerated factors to be considered are:
"the training, even though it includes actual operation of the facilities of the employer, is similar to that which would be given in a vocational school;
the training is for the benefit of the trainees;
the trainees do not displace regular employees, but work under close observation;
the employer that provides the training derives no immediate advantage from the activities of the trainees and on occasion his operations may actually be impeded;
the trainees are not necessarily entitled to a job at the completion of the training period; and
the employer and the trainees understand that the trainees are not entitled to wages for the time spent in training."
See Employment Relationship Under the Fair Labor Standards Act, WH Pub. 1297 (Rev. May 1980), available at http://www.osha.gov/pls/epub/wageindex.download?p_file-=F11973/WH1297.pdf.
The Supreme Court has said that rulings, interpretations, and opinions of the Wage and Hour Division "constitute a body of experience and informed judgment." Similarly, the Ninth Circuit has said that the Wage and Hour Division's "interpretations . . . are entitled to great deference."
Nevertheless, while some circuit courts that have addressed the issue of when a trainee is an employee under the FLSA have applied the Wage and Hour Division's all-or-nothing test (5th and 8 th Circuit) others have applied a balancing test to determine who primarily benefits from the training ( 4th, 6th, and 10th Circuits).
Seven circuits are yet to decide which test to apply, but to move too far away from the Wage and Hour Division's all-or-nothing test would be to turn our backs on the legislature's intent that the FLSA provide far-reaching protection to workers.