As a general rule, intern sponsors are not subject to the U.S. Department of Labor's minimum wage laws if their internship description meets the department's guidelines. The position must primarily be for the educational benefit of the student and not involve more than 50% clerical work. There must be supervision, training and feedback.

Many UCSB students also work part-time jobs to offset college expenses. Employers will also attract more candidates and have a stronger weekly commitment of time from the intern selected if positions are paid. Therefore, employers are encouraged to offer an hourly wage. Non-technical positions generally pay $8-12/hour. Technical interns are making average hourly rates between $14-16/hour, and Graduate Students earn $20-22/hour depending upon discipline and prior experience. The average stipend is $350 to $500 per quarter for non- technical positions.

One formula that human resource managers use to determine engineering or computer programming salaries involves taking the base rate determined as a percentage of the minimum salary grade if they were to be hired full-time into a particular classification category. Typically, the percentages range from 60% to 75% of this minimum salary amount depending upon school class level. Seniors closer to graduation make more than freshmen, graduate students make more than undergraduates. Other variables could include: GPA; prior work experience, and the length of time they can work. Salaries can increase after a three month period. Technically, interns need to report stipend earnings as taxable income. This means completing the W-2 form that withholds social security and taxes.

The UCSB Workman's Compensation and Liability Coverage does not extend to student interns. Your existing Workman's Compensation covers paid employees, and may be extended to volunteer interns for a nominal fee. New sponsors may be concerned about injuries to student interns on-the-job or those that the student might cause due to inexperience. These concerns are best addressed on a case-by-case basis. We recommend that you address any questions to existing legal counsel. These incidents are rare.

Call Worker's Compensation Insurance Rating Bureau, Accounting Office, 1-415-777-0777, for a manual that lists minimum rates for 500 industry categories. If you think your insurance career is overcharging, call Dept. of Insurance Consumer Complaints, 1-800-923-9045.