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Date Created: 12/22/15
How Companies Works? Article by Scott Emerson Cleveland Since a federal judge ruled in favor of unpaid interns who worked on Fox Searchlight Pictures’ movie Black Swan, interns have been filing lawsuits for back pay under labor statutes. Many employers have dropped their internship programs altogether, though most have not. The Black Swan ruling aside, what does it say about a company that will not even pay an employee minimum wage? Is this a company that college students will want to work for after graduation? Probably not. Take a guess what LinkedIn, Plantar, Twitter, VMware, and Facebook pay their interns? It’s a lot. More than $6200 per month, which is more than 99% of U.S. companies, pay their interns, if they pay them at all. Do these companies pay this much because they can afford it, or are they paying market rates for the best talent? Yes they can afford it, and they may be paying above market, but they are probably making a rational decision to attract the highest level talent. Fast growing companies on the leading edge of technology have internal opportunities where the best and brightest can be highly productive, so they can justify paying well above market. Can slower growing companies afford to pay comparable salaries to interns? Probably not, but that does not mean they cannot benefit from paying above market. After all, not every aspiring bright intern will be hired by Facebook or LinkedIn, or can afford to live in Silicon Valley. Not to mention that there are many smaller companies where an intern can be closer to the corner suite, and come away with more exposure to how a business works. Working for a company as large as Facebook may not be as attractive as working for one which gives broader exposure to the inner workings of the business. Which companies can justify paying interns $10-15 per hour? Most can, if the intern is put in a situation where they can be productive. That productivity is a factor of the intern’s job assignment, training, supervision and the dynamics of the company’s business. Scott Emerson Cleveland
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