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This is a guest post by Matt Faustman

Many companies approach hiring interns all wrong. Hiring interns for your company means more than just finding someone to get coffee or run errands for full-time employees. Interns can be the future of your company.

Last year, nearly 60 percent of interns joined their companies as full-time hires.

Properly run internship programs become invaluable recruiting pipelines because they provide the company with field-tested employees. You don’t have to worry if the interns can do the job or will fit into the company culture; they’ve already proven their abilities.

Hiring the best interns, however, isn’t always easy and making sure they accept your full-time offer can be even more difficult — especially if they’re talented. So here are three of the best ways to find the right candidates for your internship program and ensure that they accept a full-time offer if and when you make one.

Seek out creativity when hiring interns

It is 2013, so why are you still hiring like it’s 1980? If you want creative interns, you probably need to consider creative ways of attracting them to your company. You need big ideas to keep your company moving forward, and people with vision and enthusiasm are attracted to companies willing to take calculated risks.

Hackathons have become one of the more visible and creative ways that technology companies are recruiting top technology talent. Evernote, for example hosted its first Hackathon in Korea in an effort to recruit top Korean students. One advertising firm had interns apply to their position using the mobile app Draw Something. Candidates with the most creative drawings were selected to move forward in the process.

Tests like these allow employers to see the practical and creative skills of potential interns. Hackathons, for example, push potential interns to quickly solve problems and work within teams, sometimes alongside full-time employees.

Social media is another great way to attract interns. If you are not using social media as part of your intern hiring strategy, then you are missing out, as 26 percent of college students are using Twitter. Using media directed at certain schools or course focuses can help to quickly create attention for your company.

Consider paying your interns

With the high costs of hiring full-time employees, bringing on unpaid interns sounds like a magic bullet, but this is far from true. You are likely to come across hoards of potential interns who are begging for experience and wouldn’t hesitate to work for free. But going this route can have detrimental effects on your internship program and can put your company in legal hot water.

With the job market in a shaky place, it is becoming more common for postgraduates to be taking internships with potential employers. These postgraduates have real expenses, and taking unpaid internships can deter many of them from joining your company. Even if they do accept, 3 to 6 months of no pay can put them in a very difficult financial situation and may ruin the internship period. Receiving a paycheck also gives your interns a better sense that the company values their skills.

Furthermore, from a legal standpoint, it is extremely difficult to have unpaid interns these days, and many companies are getting burned for running free intern programs. Since 2011, there has been a surge in litigation surrounding the use of unpaid interns. The most recent example is the suit against Fox Searchlight Pictures, which is a huge blow to the media and entertainment industry that has traditionally been reliant upon unpaid interns. Apparently, the 2008 “500 Days of Summer” and 2010 “Black Swan” films used unpaid interns for secretarial and janitorial support. Not exactly a learning experience.

Most attorneys would recommend hiring an intern as a part-time employee with salary at least equal to minimum wage. Part-time employees generally have limited or no company benefits, such as health benefits, vacation and sick time, paid holidays, and unemployment compensation, unless required by state labor laws and/or company policies.

Treat your interns like full-time employees

Like any employee, interns want to feel like they are a part of the company. Many employers adopt the mentality that their interns are not real employees and therefore slack on making them feel like part of the team or adopting standard legal practices to onboard them.

One of the biggest errors that companies make when bringing on interns (especially in small organizations like startups), is to not properly inform their full-time employees how to treat interns. This may sound juvenile, but a one-hour informational session can make all the difference. One of the biggest topics to cover is how the interns will be managed. One of the biggest complaints of interns in 2012 (other than having to work for free) was that they were given menial tasks by their supervisor. Give your interns real tasks and challenges. This also helps you as an employer determine whether the intern can handle real challenges as a full-time employee.

Many companies also neglect to have their interns sign up to the usual legalities of part-time or full-time employees. This puts your company at legal risk and can misalign expectations. When onboarding employees, you should at a minimum ensure they agree to the following:

  • Offer letter
  • Invention assignment & confidentiality agreement
  • Equipment agreements
  • Employee handbook & training (safety, harassment, etc) if offered to full-time employees.

The documents you use for interns, however, cannot just be standard employment agreements; they must be specifically geared towards your interns. For example, you must specifically state in your offer letters that the internship is not a guarantee of employment.

Nurture your internship program and it will produce results

Hiring the right intern candidates for your company is crucial. Approximately 62 percent of full-time employees recruited through an internship program are still employed by the company five years later. This is almost a 15 precent bump in retention over other candidates hired from outside sources. Having a great internship program is no easy task, but if done correctly can become a competitive advantage that you will not regret.

Profile_2Matt Faustman is co-founder and CEO of UpCounsel, a site for finding and hiring legal counsel. Prior to UpCounsel, Faustman worked as a startup attorney in Silicon Valley helping consumer and enterprise internet companies get started and grow.