N.Y.: $5.85M Settlement of Interns’ Class Action Preliminarily Approved

By Rosemarie Lally Feb 23, 2015
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A $5.85 million settlement of a class-action lawsuit alleging that magazine publisher Condé Nast underpaid thousands of interns received preliminary approval from a federal magistrate Dec. 29, 2014.

The class action complaint was initially filed on behalf of two former interns who worked for Advance Magazine Publishers, Inc., which does business as Conde Nast Publications. The lawsuit claimed that the interns were covered by the federal Fair Labor Standards Act and the New York Labor Law, which require that interns engaged in the operations of the employer or performing productive work that benefits the employer must be paid the minimum wage even if they receive some benefits in the form of a new skill or improved work habits.

The suit alleged that the publisher violated both federal and state law by failing to pay interns proper wages for the work they performed. The complaint alleged that Conde Nast relied on “a steady stream of interns to perform entry-level work that contributes to its magazines’ operations and reduces its labor costs.” For example, interns’ tasks included reviewing editorial submissions and passing on those recommended to supervisors, responding to readers’ emails, proofreading, line editing, running errands, and doing other productive work.

The settlement covers nearly 7,500 interns who worked at magazines including The New Yorker, W Magazine, Vanity Fair, and Vogue from June 2007 to the present. Each class member is expected to receive between $700 and $1,900.

Condé Nast canceled its internship program soon after it was sued in June 2013.

According to guidelines issued by the U.S. Department of Labor in 2010, the following six criteria must be applied in determining whether individuals participating in private sector internships or training programs may do so without compensation:

  1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment.
  2. The internship experience is for the benefit of the intern.
  3. The intern does not displace regular employees, but works under close supervision of existing staff.
  4. The employer that provides the training derives no immediate advantage from the activities of the intern, and on occasion its operations may actually be impeded.
  5. The intern is not necessarily entitled to a job at the conclusion of the internship.
  6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

The class action settlement agreement appeared reasonable as it exceeded 60 percent of estimated unpaid wages, the U.S. magistrate said in granting preliminary approval. "Given defendant's size and stature in the publishing world, I assume it could withstand greater judgment," he wrote. "This fact, by itself, however, does not render the proposed settlement unfair."

Outten & Golden, the law firm representing the interns, plans to seek legal fees of $650,000, or 11.1 percent of the settlement fund, according to a spokesperson for the firm.

A fairness hearing is scheduled for June 22, 2015, to consider final approval of the settlement.

Ballinger v. Advanced Magazine Publishers, Inc., S.D. N.Y., No. 13-04036 (Dec. 29, 2014).

Rosemarie Lally, J.D., is a freelance legal writer and editor based in Washington, D.C.

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