Many people who were interview seem to suggest that they would hire paid workers but instead chose to use unpaid workers. Their reasons vary, but many seem to highlight the inherent value in unpaid labor.
Without a structured internship (weekly or biweekly meetings, goals, referrals, valuable introductions, ect) it seems these interns are getting very little in return.
How would you handle an unpaid intern? Would you accept unpaid labor?
I interviewed with two different offices of a large brokerage (shall remained unnamed but they were purchased by BoA). One office told me I would get school credit for filling orders. The other office offered to pay me for doing market analysis. It seems the difference lies in how much they value an interns service.
I get labeled a bleeding heart idealist by a lot of people. I remain frustrated at my inability to adequately explain that my views are typically rooted in something deeply practical. A short explanation: I basically believe in "karma" -- but I don't think there is necessarily anything mystical to it. Just because people frequently can't trace the effect back to its root cause doesn't mean there is no such relationship in reality.
<crossing my fingers and hoping that doesn't sound like some unrelated meandering rant>
Following that rule is also how you can stay in compliance with labor laws (at least in the U.S.).
It was long the practice in medicine that not only did you serve your internship for free, indeed you paid for the privilege. At some point there was a collective realization that this was contributing to, or percieved to contribute to, a good-ole-boy network instead of the meritocracy one wants of doctors. So interns, and other resident physicians, are paid.
Whether having unpaid people help with your work is good or bad is something else. They're going to cost you your own time and effort, so you need to know if you're shooting yourself in the foot by skimping on payroll.
According to the Department of Labor, if an intern's work benefits the company, then the intern should be treated as an employee. There is a six factor test, more on this here: http://www.clark.edu/student_services/employment/documents/L...
A related point, I think paying employees only with stock options is also illegal for a startup. The stock options likely don't have much value in a startup, and also the employee may lose the stock options if they quit (or are fired) prior to their vesting date.
So, both interns and employees should at least be paid minimum wage unless the company literally cannot even afford paying minimum wage. That said, the company will probably only have a legal problem if the underpaid intern/employee files a complaint.
For some reason it appears to be tolerated in the U.S. despite it apparently being illegal in many cases. Mark Cuban was whining about this recently: http://blogmaverick.com/2009/09/05/want-an-unpaid-internship...
