The U.S. Supreme Court has held that the words "to suffer or permit to work," as used in the Fair Labor Standards Act (FLSA) to define "employ," do not make all workers employees. For example, workers who work for their own advantage on the premises of another without any express or implied compensation agreement are not employees under the FLSA.

Whether trainees or students are employees of an employer under the FLSA will depend upon all of the circumstances surrounding their activities on the premises of the employer. If all of the following criteria apply, the trainees or students are not employees within the meaning of the FLSA:

• The training, even though it includes actual operation of the facilities of the employer, is similar to that which would be given in a vocational school;

• The training is for the benefit of the trainees or students;

• The trainees or students do not displace regular employees, but work under close supervision;

• The employer that provides the training receives no immediate advantage from the activities of the trainees or students and, on occasion, his operations may even be impeded;

• The trainees or students are not necessarily entitled to a job at the conclusion of the training period; and

• The employer and the trainees or students understand that the trainees or students are not entitled to wages for the time spent in training.

In South Carolina, as in all states, the Fair Labor Standards Act (FLSA) provides the framework for determining whether an individual is considered an employee or not. The U.S. Supreme Court has clarified that not all workers are employees under the FLSA, particularly if they work for their own benefit without a compensation agreement. For trainees or students, their status as employees under the FLSA depends on the specifics of their situation. If the training they receive is similar to vocational school training, primarily benefits them, does not replace regular employees, does not provide immediate advantage to the employer, does not guarantee a job post-training, and there is a mutual understanding that they are not entitled to wages during training, then they are not considered employees under the FLSA. This means that such trainees or students in South Carolina would not be entitled to minimum wage or overtime under federal law.