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Under U.S. Federal law, it is illegal to have people work for you in a business and not pay them for their work. But an "internship" lies in a gray area. The Department of Labor has guidelines to help employers determine if an internship position meets the criteria for an "unpaid internship," or whether minimum wage regulations apply. These guidelines state that an unpaid internship: should "not be to the immediate advantage of the employer," should be made up of activities that are similar to training in an educational institution, must be for the benefit of the intern, by providing valuable experience, and should not displace any regular employees. The film industry has a reputation for stretching the responsibilities of interns. Interns have sometimes viewed this "working for nothing" as a necessary evil to gain needed experience. But Fox Searchlight was recently sued by two men, Eric Glatt and Alexander Footman, who worked as production interns on the movie " Black Swan ." They claimed that they should have been paid for working full-time doing duties such as: taking lunch orders answering phones arranging travel plans for other employees taking out trash assembling office furniture tracking purchase orders Judge William H. Pauley, in Manhattan, agreed with them: "Undoubtedly Mr. Glatt and Mr. Footman received some benefits from their internships, such as résumé listings, job references and an understanding of how a production office works. But those benefits were incidental to working in the office like any other employees and were not the result of internships intentionally structured to benefit them...Searchlight received the benefits of their unpaid work, which otherwise would have required paid employees.” The judge also said that receiving academic credit was not a factor in determining whether interns should be paid, and that the Department of Labor guidelines must be followed. image from the another Twentieth Century Fox movie The Internship A spokesperson from Fox said that they would appeal the decision. Nevertheless, observers expect this ruling to have wide influence on the way that human resource departments view their internship programs. Sources: " Judge Rules That Movie Studio Should Have Been Paying Interns ," by Steven Greenhouse, New York Times, June 11, 2013. Cartoon by Aaron Bacall from www.bacallcartoons.com and cartoonstock.com Follow up: Have you ever had an internship? What were your duties? How many hours a week did you work? How did you benefit? Do you think, under the guidelines laid out in this article, that your position fell under the guidelines of "paid internship" or "unpaid internship"? Do you think the rules regarding internships should be adjusted in times of economic downturn? Why or why not? What are the possible positive and negative consequences of this ruling for entry-level employees? Check out " NYT: Room For Debate " for ideas.

image from CNN The Chinese people, experiencing some economic stability, have a big need for pork as a diet mainstay in economically decent times. The problem: demand exceeds domestic supply. The solution: Buy American . image from npr.org China has entered into a contract to purchase the U.S corporation, Smithfield Packing Company, Inc. , for $4.7 billion. Talk about bringing home the bacon! "This is a sign of a maturing agriculture industry in China," said Scott Rozelle, an expert on Chinese agriculture policy at Stanford University. "Chinese companies want more control over food. We're going to see a lot more deals like this." An article in the Wall Street Journal backs up this prediction: What will China be buying next???? Source: " Chinese Firm to Buy Pork Producer Smithfield Foods, " by Ken Bensinger and Tiffany Hsu, Los Angeles Times, May 29, 2013. Follow up: Do you like the idea of a Chinese firm owning a major American meat producer? Why or why not? Look at your reasoning...is it based on facts and evidence or fear of the unknown? Read subsequent follow up articles by doing internet research. What U.S. entities were also behind this acquisition? What does the idiom "bringing home the bacon" mean?

The IRS is responsible for approving organizational designations on corporations that have different responsibilities and privileges. An entity can be incorporated with various intentions: as a profit-making, tax-paying corporation (C corporation, S corporation, LLC) as a non-profit, charitable corporation--501(c)(3)--organized to conduct educational or other non-taxable activities as a different kind of non-profit, 501 (c) corporation that is subject to additional scrutiny because its activities are not 100% non-taxable or not 100% charitable. One type of special-scrutiny non-profit corporation is a 501(c)(4) corporation, which is a "social welfare organization" that has sometimes been called a "charity-lite" corporation. The bad news for organizations with this designation is that the contributions made to it are not deductible for tax purposes. The good news for these organizations is that once they have received initial approval from the IRS, these types of organizations can spend freely on "social welfare" activities. This is sometimes a euphemism for lobbying. They can also support partisan political candidates without a limitation on contributions. In addition, this type of corporation can give benefits to individuals and groups that are not part of a charitable class. The recent scandal involving the IRS's scrutiny of "Tea Party" organizations stemmed from the Cincinnati office's decision to maximize their efficacy by investigating organizations whose names suggested "political" rather than primarily "social welfare" intent. Some of these organizations had mistakenly applied to be charities [under the (c)(3) designation], so the scrutiny was, at least in some cases, well-founded and saved taxpayer dollars. The Cincinnati office also tapped left wing organizations in their sweep, but the number of "Tea Party" applications far outnumbered those with other political leanings. This created the appearance of bias, and led to managers being fired or placed on leave. Nevertheless, the attention that the scandal has brought to the 501(c)(4) status highlights the need for further study. Sources: " Confusion and Staff Troubles Rife at IRS Office in Ohio ," by Nicholas Confessore, David Kocieniewski and Michael Luo, New York Times , May 15, 2013 " Don't Throw the IRS Under the Bus ," by Peter Reinhart, The Daily Beast , May 20, 2013. " Should 501 (c) (4)'s be eliminated? " by Rosemary Fei, John D. Colombo, et. al ., Room For Debate, New York Times , May 15, 2013. Follow up: Distinguish between a " C corporation," an "S corporation," an LLC (limited liability corporation), a 501(c).(3) corporation and a 501(c)(4) corporation. Do you think that the 501(c)(4) designation for a political non-profit should be eliminated? Why or why not? What specific changes could make the organizations more accountable to the public?

[View:http://community.cengage.com/GECResource/themes/gew/utility/ :550:0] from youtube , posted by rockfan7777 "M&M's (WARNING: ABSOLUTELY NO BROWN ONES)." This is part of a rider, page 40, to the 1982 concert contract of the rock band Van Halen . It is sometimes joked about by those making fun of the excesses demanded by rock stars demanding diva treatment. But, according to band singer David Lee Roth, there was a good reason for this clause. Van Halen was the first band to travel with a huge number of big lights. They would contract for facilities that could deal with their electricity and space requirements, but sometimes they would get to a venue and find that one thing after another that was clearly designated as needed in the contract was not available. Therefore, the M&M clause was inserted as a " bright line test ." David Lee Roth explained: “If I came backstage and I saw brown M&M’s on the catering table, it guaranteed the promoter had not read the contract rider, and we had to do a serious line check.” Sources: " Van Halen explains the U.S .government " by Ezra Klein, Bloomberg News , April 30, 2013. Follow up: What is a "bright line test" or "bright line rule"? Give some examples from other situations. Note the disparity in reactions possible between hearing the short version of the M&M clause story, and the longer explanation. What miscommunications can occur from limited information?

" Sequestration ." The dictionary definition looks pretty grim. Here's the Merriam-Webster version: Noun The action of taking legal possession of assets until a debt has been paid or other claims have been met. The action of taking forcible possession of something; confiscation. Synonym seizure John Schwartz takes a satiric attempt (I think) in this article, to illuminate the reality of Federal sequestration by making analogies to what it would mean in a personal budget to apply parallel techniques. One of the underlying premises is parallel to the "no new taxes" position of some in Congress, as well as standard financial-advisor wisdom: It is easier to cut spending than it is to increase income. Therefore, the spending cuts that Schwartz suggested implementing included: cancelling all house tours and golf outings (this was to parallel the White House edict, though no real cost savings could be expected, since there were no tours or golf outings before) informing Bank of America unilaterally that the family would be paying less on their mortgage (the B of A executive he talked to said that the unilateral action could lead to foreclosure, but there was a proper process that would preserve the family credit rating) telling his son to "get shorter" (these are "across-the-board" cuts) cutting down on cat food and kitty litter (hmm) making dishwasher repairs himself Schwartz didn't get much co-operation from his family members, and concluded that the lack of co-operation might be country-wide. Sources: " The Kitchen Table Sequester ," by John Schwartz, NYT Business Day , April 6, 2013. Follow up: What is a "satire"? Does this article fit that definition? Get a copy of The Onion for other examples of this writing style. How effective is it at communicating the message? What are the major pitfalls of this technique? What are the possible benefits of this communication technique? What other tools of persuasion are used in this article? What do you think about sequestration? Has this article changed your view of it, or made it more clear? Discuss your reaction. How could the article have been improved?

image from caninescorner.org: a Raccoon Dog What is a company to do if they can't get control of their supply chain? The demand for "faux fur"--high quality synthetic furry material--has been higher than supplies. Some companies have made a surprising substitute: the Real Thing. The retailer Nieman Marcus was recently caught advertising Burberry coats trimmed in "faux fur"...which turned out to be raccoon dog , an East Asian canine that looks like a raccoon. image from www.niemanmarcus.com The marketing problem is also a legal problem: some individuals have allergies to real fur, and others just prefer not to wear it for ethical or other reasons. A company can't advertise a product as "fake fur" and just substitute real fur. The Humane Society tested the suspected products , and reported their findings to the Federal Trade Commission (FTC). FTC officials reported that Nieman Marcus and the other retailers agreed to follow the law. Source: " A Faux Faux Fur Kerfuffle at Nieman Marcus ,"by David Weinberg, Marketplace, American Public Media , March 20, 2013. Follow up: Recently there was another case where substitutions had been made: horse meat had been substituted for beef. Research this substitution. Summarize who was involved in that case and what consequences occurred and were imposed. What are other alternatives manufacturers have (besides substitution) when they have problems getting supplies needed for production? What are the consequences of these alternatives? If you were the purchaser of a product in which there had been a substitution from what was advertised, what remedies would you expect would be fair?

Recently, a company in New Mexico filed an application to slaughter horses for meat. Slaughtering horses for meat has been banned in the USA since 2007, but the law expired in 2011. Valley Meat 's application to begin this practice again was newsworthy...as well as being a jumping off point for various jokes...as well as outrage. Reading the articles about the application reminded me of a sight from an Italian grocery store, in the baby food section . It seemed unusual enough to my American sensibilities to warrant a photo: photo by Teri Bernstein It shouldn't have surprised me to read today's update to the article. Valley Meat, who has been operating a cattle slaughtering business to this point, has had several health and production violations over the last few years. According to the Federal Meat Inspection Act , the property of any slaughterhouse or meat processing plant “ must be maintained to prevent conditions that could lead to insanitary conditions, adulteration of product, or interfere with inspection .” Unfortunately, there have been violations documented by the New Mexico environmental department that Valley Meat has not filed an application to be a "composter" and has not properly disposed of animal waste and the by-products of the cattle slaughtering operation. Dealing with waste is always a component of an adequate production process. Read the article if you are interested in the grim details. Source: " Horse Meat Applicant's Food Safety is Questioned " by Stephanie Strom, The New York Times , March 13, 2013. Follow up: Do you think that a company with health violations regarding meat production should be allowed to expand its operations? Why or why not? What is the role of the Federal and/or State governments in regulating food production, in particular meat production, in your opinion? What is the level of compliance standards that you would want for yourself and your family? How should compliance inspections be funded? What should be the standards for determining what animals can be slaughtered for meat? Who should determine these standards? How do these standard affect the rights of businesses to operate and make money? Should companies be required to deal with its waste products as a condition for being licensed for production? Or is this unnecessary regulation?

banner image from thinkprogress.org Several businesses filed " amicus briefs " with the US Supreme Court recently, in the DOMA case. DOMA, the "Defense Of Marriage Act," is a federal law signed during the Clinton administration. It prevents the federal government from recognizing as marriage anything besides "a legal union involving one man and one woman." It is being challenged, and several businesses have signed a brief requesting that the Supreme Court overturn DOMA. The brief does not address the sociological or religious issues that often surround discussions of this issue--it's all about maintaining profits and keeping down costs of compliance with federal regulations. In states where gay marriage has been legalized, legally married couples who do not fall under the DOMA definition have to be treated differently with respect to federal and state laws regarding health care, retirement and taxes, for example. Businesses cite that this "impairs employer/employee relations and other business interests." Those "other business interests" include the costs of maintaining separate records and deduction systems to comply with state laws that differ from federal laws. The different treatment also exposes businesses to possible allegations of discrimination, as well as "unnecessary cost and administrative complexity." Some of the businesses that signed on to the brief appear in the graphic below. Source: " Federal Gay Marriage Ban Hurts the Bottom Line, Businesses Argue " by Erica Ryan, National Public Radio , February 28, 2013. Follow up: What is your reaction to the neutral, "strictly business" tone of this argument for standardizing marriage laws for adults on a national basis? Can you think of another debatable topic where approaching it from a "business perspective" might make it less divisive? *