Worcester Business Journal

wbjournal.com | April 30, 2018 | Worcester Business Journal 21 Fiduciary duties Set up a proper intern program V I E W P O I N T E D I T O R I A L W hat does it mean to run or be on the board of directors of an organization? Most organiza- tions have a mission and a set of values, as well as guidelines and expectations for its governing bodies, be they senior management or a set of independent di- rectors. While many for-profit businesses forgo a formal board setup, nonprofits require a governing body of independent directors who can help the organization without any personal or professional conflicts. Sometimes there is a crisis never making the news but is successfully resolved. Other times the board ignores a number of warning signs, and the outcome in those cases is never pretty. While a nonprofit board may get involved in the weeds and deal with any number of tactical issues, depending on the size of the organization, all boards need to take the long view and be aware of their long-term viability, as well as changes in the marketplace threatening the organization. While the owners of a privately held company can ignore tough market conditions and sustained losses and run their enterprises into the rocks, that is not supposed to happen in the nonprofit world. An independent set of directors should see the writ- ing on the wall – well before the money runs out – and seek to sustain the organization's mission by partnering/merging with a stronger entity who has the interest and capacity to carry on. A good example of a board who looked ahead and made the tough decision to seek a merger with a stronger partner was Worcester's Higgins Armory, whose collection was taken over by the Worcester Art Museum in 2014. At the time, Higgins had almost $3 million le in its endow- ment – enough to keep the organization afloat W hile it's hard to imagine summer is right around the corner, certain employers annually look forward to the prospect of free summer labor provided by unpaid interns. But not every intern should be unpaid. In 2010, the U.S. Department of Labor adopted a six-factor test to determine whether a person could law- fully be classified as an unpaid intern under the federal Fair Labor Standards Act. If all six factors were not met, the intern needed to be paid and treated just like any other paid employee, e.g. paid minimum wage and overtime eligible. A number cases were brought by interns challenging their unpaid intern status. In the 2015 case of Glatt v. Fox Searchlight Pictures Inc, the Second Circuit Court of Appeals deviated from the rigid six-factor test and adopted a more flexible seven-factor test that placed the focus on which party – the employer or the intern – was primary beneficiary of the internship. To answer that question, the court analyzed whether the internship was primarily for the educational benefit of the intern or for the financial, cost-saving benefit of the employer. In January, the DOL issued a new guideline that adopts the flexible seven-factor primary beneficiary test. e seven factors are: the intern and employer both must clearly understand the position provides no com- pensation, the internship training is similar to that of an educational environment, the internship is tied to the intern's coursework or academic credit, the duration is limited, the intern complements – rather than displaces – the work of a paid employee, and there is no expectation of a paid job at the end of the internship. No single factor is, by itself, dispositive. e failure to meet any one or more of the seven factors does not auto- matically mean that the internship is not primarily for the educational benefit of the intern. Yet, to help establish the intern is the primary beneficiary under the seven-factor test above, there are a few actions employers may wish to take. • First, when posting for an internship, the ad should indicate college students who can earn college credits are given priority. • Second, when offering the intern position to the selected candidate(s), the offer letter should expressly state that the position is not paid and there is no guarantee that the intern will receive paid employment with the employer in the future. • ird, if possible, the employer should implement a formalized internship program which details all aspects of the internship, including duration, precise start and end dates, and a detailed schedule of any rotations, etc. within the organization to occur during the intern's tenure. Joseph T. Bartulis, Jr., is chairperson of the Labor and Employment Law Practice Group at Worcester law firm Fletcher Tilton. BY JOSEPH T. BARTULIS, JR. Special to the Worcester Business Journal Joseph T. Bartulis, Jr. The Worcester Business Journal welcomes letters to the editor and commentary submissions. Please send submissions to Brad Kane, editor, at bkane@wbjournal.com. WO R D F R O M T H E W E B W for several years, despite operating losses. But the board determined its structural losses could not be turned around, and while they had an endowment, it was not responsible to spend it down to zero. Now, the Worcester Art Museum – aer years of displaying the Higgins collection in temporary exhibits – announced this month it is planning a permanent exhibit with the help of a $40,000 grant from the National Endowment for the Humanities. Contrast this with the debacle playing out at Mount Ida College in Newton (and to some degree at Atlantic Union College in Lancaster). Aer 119 years of operation, Mount Ida announced earlier this year in rather sudden fashion the sale of its 72-acre campus for $70 million to UMass Amherst to provide housing for Boston interns, thus leaving in the lurch about 850 tuition-paying Mount Ida students who have to transfer elsewhere and pos- sibly lose their scholarships. Atlantic Union had a similar debacle twice: Shutting down its bachelor's degree programs in 2011 aer losing its accred- itation; opening back up in 2015 in the hopes of regaining accreditation while actively recruiting students to take classes for degrees they could not yet earn; and then shuttering again this year. Being a nonprofit board can provide some great networking opportunities and give you the satisfaction of being involved in the organization's important mission. But there is heavy liing, and all the media coverage coming from the Mount Ida debacle suggests the school's governing body did not deal effectively with financial troubles mounting for years. So while the Higgins Armory board may have taken heat at the time for ending the independent operation of its world class armor collection, being deliberate and strategic about its sale was in hindsight a prescient move. Tweets of the week "A ban in a community with a 96-percent compliance rate when it comes to sales, does not address the real & underlying issue." - Stuart Loosemore (@stuloosemore), April 19, on a WBJ story about the city banning flavored tobacco in non-age-restricted retail stores "Are #Manufacturers too modest when it comes to promoting themselves? We believe it's time to recognize their powerful accomplishments and contributions to our economy." - Applied Interactive (@appinteractive), April 18, on the WBJ's naming of its Excellence in Manufacturing Award winners for 2018 Facebook feedback "It's becoming 'Shrewsbrewery' street! Love it!" - Joe Cox, April 20, on Redemption Rock Brewing Co. planning to open a brewery and taproom on Shrewsbury Street in Worcester "So sad! If I could only have one more mac and cheese pizza!!!" - Stacy Olkkola, April 19, on a story about Shrewsbury restaurant 2ovens closing as a result of Bertucci's bankruptcy filing W

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