SkillBridge Liability: What Host Companies Must Know

You found a strong SkillBridge candidate. Your team wants to host. Then legal or risk asks the question that stalls the whole thing. What are we on the hook for?

It is a fair question. A SkillBridge participant is not a normal intern. They are still active-duty military the entire time. You are not their employer. That one fact changes who owes wages, who covers an injury, and what you sign.

This guide walks the liability basics for host companies. Who is the employer of record. Whether you pay them. Who covers a hurt participant. What the Memorandum of Understanding actually binds you to. And what you are not responsible for.

One note up front. This is a plain-English overview, not legal advice. Every company runs a different insurance and risk setup. Loop in your own counsel and your carrier before you sign anything. If you are still deciding whether to host at all, start with our guide on how to become a SkillBridge host company and come back here for the risk picture.

Is a SkillBridge participant your employee?

The short answer is no. During SkillBridge, the service member stays on active duty. The Defense Department keeps paying their salary and benefits. Their parent service still owns them. You host the training. You do not employ them.

This is the core fact behind almost every liability question. The employer of record is the military, not you. The participant is on a training authorization, not a job. They report to your team day to day. But they can be pulled back to their unit if the mission calls for it.

So the normal employer duties do not attach the way they would for a W-2 hire. You are giving a transitioning member real work experience. You are not adding them to payroll. The status here is close to what you would manage with a reservist. Our guide on managing an employee called to active duty covers that active-duty parallel in more depth.

Do you have to pay a SkillBridge participant?

No. You pay them nothing. Not wages. Not a stipend. Not benefits. The military covers all pay and benefits during SkillBridge. Paying a participant on top of that can actually break the program rules.

The Labor Department settled the wage question directly. In opinion letter FLSA2019-14, the Wage and Hour Division looked at whether SkillBridge participants count as employees under the Fair Labor Standards Act. It found they are interns, not employees. Active-duty members in SkillBridge are not covered by the FLSA, the Davis-Bacon Act, the Service Contract Act, or the CWHSSA.

In plain terms, minimum wage and overtime rules do not force you to cut them a check. The FLSA definition of an employee just does not reach an active-duty member on a training authorization.

There is a limit that protects this status. Participants may not work more than 40 hours in a workweek. Treat the internship as training and a working tryout. Do not treat it as free labor to backfill an open role. That line is what keeps the intern classification clean.

How is this different from a regular unpaid internship?

A normal unpaid internship is a legal minefield. Under the Fair Labor Standards Act, most for-profit interns have to be paid. There is only a narrow exception, and it is fact-specific.

The Labor Department calls the test the primary beneficiary test. If the intern is really doing the work of a paid employee, they count as an employee. Then you owe back wages. Companies get sued over this exact line. You can read the rule in the Labor Department's Fact Sheet #71 on internship programs.

SkillBridge sidesteps that whole problem. The participant is active-duty and already paid by the military. The Labor Department looked at the program directly and found these members are not employees under the FLSA. You are not leaning on a fact-specific test a court might second-guess later. The classification is settled at the program level.

That is a real liability difference. With a regular unpaid intern, the burden sits on you to prove they were not an employee. With a SkillBridge participant, the member's active-duty status and the program design carry that weight. You still keep the guardrails clean. No displacement, close supervision, under 40 hours. But you are not exposed to the same back-wage claim that sinks a sloppy unpaid internship.

One thing to keep straight. This protection comes from the member being on active duty in an approved program. It does not stretch to a civilian intern you label SkillBridge without an approved MOU. The approval and the active-duty status are what make the difference. Skip either one and you are back in normal internship-law territory.

Who covers a SkillBridge participant if they get hurt?

This is the question risk teams care about most. The general answer is the military, not you.

Because the participant stays active-duty, an injury during SkillBridge is generally handled through the military system. The host company is not set up to be responsible for the member's medical care, disability, or workers' compensation. The Defense Department stays responsible for pay and benefits the whole time. Military medical and on-duty injury coverage generally applies, not your workers' comp policy.

That said, this is exactly where you talk to your own people. Your general liability and your workers' comp carrier should know a SkillBridge participant is on site. Ask two questions. Does having a non-employee in the building change anything on our policy. What happens if the participant damages property or a third party gets hurt. Your MOU and your insurer give the real answer for your setup.

Do not assume. Confirm it in writing before day one. The cost of asking is an email. The cost of guessing wrong is a claim nobody planned for.

What does the SkillBridge MOU put you on the hook for?

Every host has to sign one thing first. An approved Memorandum of Understanding with the Defense Department. No approved MOU means no hosting. This is the document those searches are really asking about, and it is where your obligations live.

The MOU is executed through the Military-Civilian Transition Office. It sets the rules, roles, and responsibilities for running a program. You do not get to freelance the terms. You agree to run the internship inside the program guardrails. You can review the current template on the official DoD SkillBridge site.

Here is what the MOU generally commits a host to do.

These terms trace back to the program's founding instruction, DoD Instruction 1322.29, which lays out the close-supervision and no-displacement standards. Read the actual MOU you are asked to sign. Have counsel read it too. It is short. But it is the contract that defines your exposure. Terms can vary a little by branch or installation. Read the version in front of you, not a template you found online.

What are you NOT responsible for?

Just as useful as knowing what you owe is knowing what you do not. During a SkillBridge internship, you are generally not responsible for these.

• Paying the participant: The military does.
• Their benefits or health coverage: The military does.
• Employment taxes on them: They are not your employee.
• A workers' comp claim for a duty-status injury: Military coverage generally applies.
• Giving them a job offer: A tryout is not a hire.

A few common worries also fall away because they were never your employee. There is no unemployment claim against your account when the internship ends. There is no COBRA to offer, because you never put them on your health plan. There is no severance question either. The internship simply ends on its scheduled date, and the member goes back to their transition timeline.

You do own the training experience, a safe work site, and living up to the MOU you signed. That is a much smaller footprint than a normal hire. For a lot of midsize companies, that gap is the whole appeal. You get a working tryout with a transitioning service member, and the payroll and benefits sit with the military.

How do you keep your SkillBridge program low-risk?

The risk on SkillBridge is rarely the participant. It is running the program sloppy. A few habits keep you clean.

Do these and the liability story is boring, which is exactly what you want. The upside stays. You meet strong talent early, run a real tryout, and pay nothing during the internship. If it works, you can convert the participant into a full-time hire after they separate. If it does not, you both learned something cheap.

For the money side of that math, our SkillBridge cost and ROI guide breaks down what a program actually costs you. And if you host regularly, a well-run pipeline doubles as documented veteran outreach for VEVRAA.

Where do the SkillBridge candidates come from?

Handling the liability is the easy part once you know the rules. Finding strong participants is the real work. You can pull from the official SkillBridge provider directory, post a role that reads well to transitioning members, or work a veteran talent pool directly.

That is where BMR comes in. Best Military Resume adds more than 1,000 new profiles every month. More than 74,391 resumes have been built on the platform. These are transitioning service members and veterans actively planning their next move. Many are looking for exactly the kind of SkillBridge tryout your team can offer.

If you want access to that pool for your SkillBridge program or a direct hire, reach out through our hire page and tell us the roles you are filling. Prefer to build a repeatable pipeline? You can partner with us and we will point you to the veteran talent that fits.