In major setback for unpaid interns, appeals court rules knowledge is compensation enough

Fox Searchlight Pictures Inc. and The Hearst Corporation may have just gotten off the hook for not paying their interns. A lower court previously ruled that the companies had broken the law by not paying interns, but a U.S. appeals court in Manhattan backpedaled on that decision on Thursday, saying that as long as interns gained knowledge in a particular career field in an internship, payment is not necessary. "The purpose of a bona‐fide internship is to integrate classroom learning with practical skill development in a real-world setting," Circuit Judge John Walker wrote.
Though the ruling offers some clarification as to what constitutes appropriate intern work and what does not, the cases will now be sent back to U.S. judges in Manhattan, who will decide if the Fox and Hearst internships were primarily educational.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
-
Withdrawing 529 plan funds for college? Here's what to know.
the explainer Maximize the amount you have stashed away for your education
-
Disney is still shielding Americans from an episode of 'Bluey'
Talking Points The US culture war collides with its lucrative children's show
-
6 captivating new museum exhibitions to see this summer
The Week Recommends Get up close to Gustave Caillebotte and discover New Vision photography
-
Crypto firm Coinbase hacked, faces SEC scrutiny
Speed Read The Securities and Exchange Commission has also been investigating whether Coinbase misstated its user numbers in past disclosures
-
Starbucks baristas strike over dress code
speed read The new uniform 'puts the burden on baristas' to buy new clothes, said a Starbucks Workers United union delegate
-
Warren Buffet announces surprise retirement
speed read At the annual meeting of Berkshire Hathaway, the billionaire investor named Vice Chairman Greg Abel his replacement
-
Trump calls Amazon's Bezos over tariff display
Speed Read The president was not happy with reports that Amazon would list the added cost from tariffs alongside product prices
-
Markets notch worst quarter in years as new tariffs loom
Speed Read The S&P 500 is on track for its worst month since 2022 as investors brace for Trump's tariffs
-
Tesla Cybertrucks recalled over dislodging panels
Speed Read Almost every Cybertruck in the US has been recalled over a stainless steel panel that could fall off
-
Crafting emporium Joann is going out of business
Speed Read The 82-year-old fabric and crafts store will be closing all 800 of its stores
-
Trump's China tariffs start after Canada, Mexico pauses
Speed Read The president paused his tariffs on America's closest neighbors after speaking to their leaders, but his import tax on Chinese goods has taken effect