More companies are being hit with suits over unpaid wages and overtime than ever before. Since 2004, wage-and-hour lawsuits under the Fair Labor Standards Act (FLSA) have risen 77%, according to the National Employment Lawyers’ Association.

That same time period has seen an 11% increase in FLSA enforcement actions by the department of Labor. Some of the biggest problem areas being targeted:

1. unpaid overtime due to misclassification
2. requirements that employees spend their own money for company purposes (for example, buying uniforms or other equipment), and
3. supervisors altering time sheets to avoid paying OT.

In the past five years, employers have paid a total of $1.5 billion as a result of wage-and-hour suits. And with many employees working longer hours — and many people needing more money to make ends meet — FLSA compliance is more important than ever.

When hiring summer help, how do companies know whether they’re getting a true intern or an employee who must be paid at least minimum wage?

The Fair Labor Standards Act (FLSA) never uses the term “intern.” However, it does distinguish between employee and a trainee. Many interns qualify as trainees, and therefore aren’t covered by the FLSA.

But not all of them qualify. The Department of Labor uses a six-factor test to determine who can legally be considered a trainee. All of the following criteria must be met, according to the DOL:

• The training is similar to what would be offered in a vocational school
• The primary benefit of the program is for the trainees
• The trainees don’t displace regular employees
• The employer gets no “immediate advantage” from the trainees’ activities
• The trainees aren’t guaranteed a permanent job at the end of the program, and
• They understand beforehand they aren’t entitled to wages.

Simply put, if the interns benefit from the arrangement, they can legally be considered volunteers rather than paid employees. To keep compliant, the focus of an internship program should be on mentoring and exposing interns to real-life experience, rather than on getting them to produce a certain amount of work.

Read more from the DOL here.