Burberry is the latest design house to be targeted in a growing pool of unpaid internship lawsuits, all being filed by two New York-based law firms. The attorneys at Leeds Brown Law, P.C. and Virginia & Ambinder, LLP are currently representing plaintiffs in cases against Gucci, Calvin Klein, Marc Jacobs, Oscar de la Renta, and Donna Karan. The latest former fashion intern to file suit with the help of the law firms: Lysandra Whitlow. According to Whitlow's complaint, which was filed in New York State Supreme Court, she served as a showroom intern with Burberry in New York for four months beginning in May 2012, working 32 hours a week on tasks that included "trapping and handling samples, providing hospitality and customer service during important market weeks to places such as Nordstrom, Saks Fifth Avenue, and Bloomingdales, coordinating showroom meetings and maintaining the showroom calendar."
Moreover, Whitlow, who currently works as a Showroom Administrator at ANN SACKS Tile & Stone in New York, alleges that over the past six years, Burberry has systematically misclassified entry level employees as minimum wage-exempt interns in violation of New York Labor Law. In lieu of providing compensation, Burberry also allegedly failed to provide Whitlow and other similarly situated interns with work that furthered their skills or provided them any academic benefit, as required by both state and federal employment law in connection with unpaid internships.
Unlike a number of the other unpaid intern lawsuits, which have been filed on grounds of both federal and state labor and wage violations, both this lawsuit and the others filed by Leeds Brown Law, P.C. and Virginia & Ambinder, LLP, are are being filed based on violations of New York state law, and not of the Fair Labor Standards Act. By now, you are likely familiar with the standards that the Department of Labor set out for determining whether an individual should be characterized as an intern or an employee. These factors include:
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 is for the benefit of the intern;
3) The intern works under close staff supervision and does not displace regular employees;
4) The employer derives no immediate advantage from and may in fact be impeded by the intern;
5) The intern is not necessarily entitled to a job after the internship; and
6) The employer and the intern understand that the intern is not entitled to wages.
If these six factors are not met in their entirety, an intern is deemed to be an employee in accordance with the Department of Labor, and must be paid at least minimum wage. New York state law, however, implements a strict eleven-factor test, which extends to the internship screening process, internship agreement specifics, and other factors. The additional requirements set forth by New York state include:
1) Interns be notified in writing that they will not receive any wages and are not considered employees for minimum wage purposes.
2) Any clinical training is performed under the supervision and direction of people who are experienced in the activity.
3) The interns do not receive employee benefits.
4) The training is general and qualifies interns to work in any similar businesses in the industry.
5) Advertisements, postings, or solicitations for the internship program clearly discusses the educational benefits rather than employment, although employers may indicate that qualified graduates may be considered for employment.
As for Whitlow's counsel, it is not terribly surprising that she is being represented by attorneys at Virginia & Ambinder LLP and Leeds Brown Law PC, as sources suggest, the recent flurry of litigation from fashion industry interns in connection with these two law firms may not be a coincidence at all. It appears to have been brought on by aggressive efforts from these two law firms to solicit ex-interns to file suits. According to Mallory Musallam, who interned for David Letterman from September to December 2008 and subsequently filed suit because she did not receive compensation, she was coerced into filing an unpaid internship lawsuit by the exact firms that are representing the plaintiff in this lawsuit. After filing suit against Letterman in September, Musallam filed to have the lawsuit dismissed, and issued a formal apology to Letterman, claiming she was approached by a “beguiling legion of lawsuit-hungry attorneys,” who saw her “Late Show” internship listed on her LinkedIn page and contacted her. She claims they coerced her into filing the class action lawsuit. Moreover, Musallam stated in her letter to Letterman that the “inveigling suit squad” of lawyers assured her that her intern work was little more than indentured servitude, and she blamed her willingness to fold to the pressure to file suit as a result of being in a “weak, vulnerable time” and being “facing student debt.” The firms deny such allegations (obviously).
As we have told you in the past, such litigation-hungry activity on behalf of legal counsel in a class action (while questionable) is not completely nonsensical. In such class action lawsuits, the lawyers are almost always paid a percentage of the fund recovered from the class, which is a far larger sum of money than any of the individual plaintiffs receive. For instance, the former intern plaintiffs in the Conde Nast settlement each received between $700 and $1000 dollars, whereas the attorneys reportedly recovered roughly 30% of the total, which was $5.8 million. More to come …