A recent New York State Supreme Court decision raises the bar for certifying an “opt out” class of unpaid interns seeking minimum or other wages, and provides valuable guidance for employers facing challenges to their unpaid internship programs. Rodriguez v. 5W Public Relations, Index No. 156571/14 (July 26, 2016). In Rodriguez, Justice Cynthia Kern denied class certification to named plaintiff Kristina Rodriguez and a putative class of individuals who interned with a New York City public relations firm. Rodriguez alleged that, since 2008, she and others were misclassified as unpaid interns when they were actually employees entitled to minimum wage pursuant to the New York Labor Law (“NYLL”) §§ 663 and 198.
In the denying the former intern’s motion for class certification pursuant to CPLR § 901(a)(2), Judge Kern stated that the plaintiff failed to establish that “questions of law and fact common to the class predominate over questions affecting only individual members.” The Court held that for each allegedly misclassified intern to prove a claim would require “individualized proof as opposed to generalized proof” revolving around the employer’s uniform policies.
Justice Kern adopted the employer’s argument that differentiating between interns and their respective experiences would require examination of individualized evidence such as each intern’s specific department, the intern’s supervisor and his or her conduct, whether the intern received academic credit, and the amount of credit received. In so holding, Justice Kern also addressed the legal standard applicable to determining whether an individual is considered an intern or an employee under the New York Labor Law in the wake of the Second Circuit’s 2015 decision in Glatt v. Fox Searchlight Pictures, Inc., 811 F.3d 528 (2d Cir. 2015) (adopting a “primary beneficiary” test for determining intern status under the FLSA, and rejecting the U.S. Department of Labor’s six-factor test). Significantly, Justice Kern opined that, while the question of which test to adopt was not before the Court on the certification motion in Rodriguez, New York state courts will apply a balancing test “similar to the [primary beneficiary] test adopted by the Second Circuit in Glatt,” and she expressly rejected the Department of Labor’s “six-factor test which focuses solely on whether the employer receives an immediate advantage from the interns’ work.” The Court specifically identified factors from Glatt that New York courts likely would consider when determining an internship’s “primary beneficiary”: whether an intern expected compensation, received academic credit, the skills learned by the intern, and the extent to which those skills were tailored to the intern’s academic course of study.
Rodriguez is a welcome decision to employers defending intern claims or seeking guidance regarding the factors impacting intern classification under the New York Labor Law. However, an appeal is likely, and employers must continue to monitor litigation developments and agency guidance in crafting internship policies.