Companies Offering Fewer Unpaid Internships [AUDIO]

Many employers are starting to do away with unpaid internships amid lawsuits that claim interns should be compensated for their work.

With strict labor laws, employers are re-evaluating their programs, said Charles Sullivan a law professor at Seton Hall Law School.

"They are being a lot more careful about making sure the program can be compensated with college credit and they just don't want to run the risk of a lawsuit."

During and after the recession, unpaid internships were everywhere as employers faced tight budgets, said Sullivan. "That also led to a lot of companies replacing minimum wage employees with unpaid students."

Sullivan said a lot of employers are now providing on-the-job training which can also blur the line between a paid and unpaid position.

"They've been getting work from individuals and not paying them and then calling it educational experience...and in some cases that might be true...but I think that's a really daring thing for any company to do."

But he also cautions about employers' overreaction. "That could hurt the internship process if students can't go and provide free work that is getting them college credit. It would be a big loss for students nationwide."

There are nearly 1.5 million internships nationwide each year, half of which are unpaid.