Updated Test to Determine Intern Status Under FLSA

By Jeffrey L. Rhodes Oct 8, 2015
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Twenty-five former students in a nurse anesthesiology degree program that assisted in surgical procedures will have their collective action wage claims evaluated using an updated test under the Fair Labor Standards Act (FLSA), the 11th U.S. Circuit Court of Appeals ruled.

Wolford College offers a master’s degree program in nurse anesthesiology. Students who complete that program and obtain the required certification and licensure can become certified registered nurse anesthesiologists (CRNAs), who administer anesthesiology in surgical procedures. As part of this training, Wolford provides clinical experience to student registered nurse anesthesiologists (SRNAs) through a related anesthesia company, Collier Anesthesia. The training involves Collier furnishing the SRNAs to hospitals and other facilities to perform anesthesia-related services in medical procedures.

Wolford’s master’s degree program is 28 months long and requires three semesters of in-class learning followed by four semesters of clinical experience. To comply with accreditation standards, the training must include participation in at least 550 clinical cases. SRNAs must learn how to complete preoperative forms, set up anesthesia equipment, draw proper medications, monitor patients under anesthesia, stock and restock carts, prepare rooms for use, and clean equipment.

Students in the program must sign forms acknowledging that they are not employees and are not guaranteed any employment by Collier upon graduation. Nevertheless, 25 former students filed a federal lawsuit claiming that they provided services that primarily benefited Wolford and Collier and that they should have been paid minimum wage and overtime under the FLSA. The students claimed that they worked in excess of 40 hours per week for Collier (even though Wolford’s curriculum contemplates 40 hours of clinical work per week) and that they worked weekends, holidays and days in between semesters. They also claimed that many of the activities they performed, including readying rooms, stocking carts and preparing preoperative forms, were not directly supervised by a CRNA.

The defendants (Wolford, Collier and their owners) filed a motion for summary judgment to have the case dismissed before trial. They cited the acknowledgment forms signed by the students and also submitted evidence that Collier did not need the students to service medical facilities. In fact, they claimed, Collier not only had enough licensed professionals on staff to perform that task but also devoted significant resources to giving SRNAs operating room experience because doctors and patients are often reluctant to have a student anesthesiologist participate in procedures.

The district court reviewed the evidence, decided that the students were not employees and dismissed the case. On appeal to the 11th Circuit, the students argued that the district court ignored the U.S. Department of Labor’s (DOL’s) six-factor test in deciding whether they were employees. The DOL test considers: 1) whether the training is similar to training that would be provided in a vocational school; 2) whether the training is for the benefit of the students; 3) whether the students displace regular employees; 4) whether the provider receives an immediate benefit from the training or is instead impeded by it; 5) whether the students are entitled to employment after graduation; and 6) whether the provider and the students agree that the students will not be paid wages.

In considering the arguments on appeal, the 11th Circuit determined that the DOL’s six-factor test did not accurately reflect the law on this issue. Instead, the court applied a seven-factor test that focuses on the extent to which the provider of training “takes unfair advantage of or is otherwise abusive toward the student.” As such, factors 2 and 4 of the DOL test (concerning benefit to the student and provider) are expanded into multiple factors concerning course work and scheduling of training. These factors consider the extent to which the internship is integrated into the scholastic program as well as the extent to which the training calendar corresponds to the academic calendar and accommodates academic commitments. If a training program requires work far in excess of the scholastic calendar and impedes academic commitments, this may show that the provider is obtaining work at the expense of the students, in which case the students should be paid.

The 11th Circuit required the district court to reconsider summary judgment using its updated seven-factor test. It did not offer an opinion as to whether the students’ evidence would or would not demonstrate that they were employees under this test.

Schumann v. Collier Anesthesia, 11th Cir., No. 14-13169 (Sept. 11, 2015).

Professional Pointer: Companies providing internship programs are well-advised to reconsider how their programs are structured. They should particularly examine the work schedule imposed and seek to coordinate training commitments with the academic calendar and course work.

Jeffrey L. Rhodes is managing partner of the civil division of Albo & Oblon, a business and employment law firm in Arlington, Va.

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