Getting the Most Out of Interns

To be sure, many companies use "unpaid interns" and get away with it. But it's taking a chance, Levitt says. If the interns are not paid, they are not technically employees.

As a result, if an intern is injured on the job, he or she may not be covered by your workers' compensation insurance, and you could be liable.

hat's more, if you are deriving a clear benefit from their work (and what would be the point if you weren't?) and if the interns are performing tasks you would otherwise have to pay employees to do, you could be sued for wages, according to the Fair Labor Standards Act. Nguyen pays her interns between minimum wage and $15 an hour. She considers it money well spent.

Once you've hired an intern, don't scrimp on training. After all, you're dealing with young people with limited, if any, real workplace experience.

When a new intern joins Chic Boutique, Nguyen spends 60% of her own time during the first two weeks on training. That's an awful lot of time, she admits, "but the more you teach them, the more you're going to get out of them, the more they're going to give you what you want."

And the less likely it is that you'll wind up cleaning up after an intern-created fiasco. This past spring, Aliza Sherman, owner of Big Horn Marketing in Laramie, Wyo., discovered to her horror that a college student intern had given herself a bit of a promotion -- boasting to her fellow students that she was Sherman's "business partner" and that she, the intern, had the authority to hire employees.

It took a month for Sherman to discover that the intern was promising her friends jobs with the company.

Needless to say, Ms. Big Britches is no longer with the company -- and Sherman learned an important lesson. "Be sure you draw boundaries for the interns," she says. "Define their role -- including how they can represent themselves regarding your company."

Training an intern does not have to be a chore. In fact, it can be a great way to develop management skills -- for you or for your employees. That's how it's considered at Development Counsellors International, a marketing firm in New York City that brings on about six interns a year.

"We see this as an opportunity to train our junior staff to manage," says Julie Curtin, the company's vice president. One fledgling manager recently had to handle the touchy subject of an intern's inappropriate office attire (low-slung pants and high-cut shirt). The junior staffer handled it "with grace and professionalism," says Curtin. "It was a good experience for everyone."