Fine for Using Volunteer workers

We had a discussion a while back about someone who "volunteered" in a tasting room (may be in violation of laws). See below. I wonder if the IRS would allow 501c3 status under certain circumstances?

Not sure why cancer has anything to do with this story.


Bill Smyth has cancer. He runs Westover Winery in Livermore Valley as a hobby. And now he's going out of business, after being fined $115,000 for using volunteer workers. The fine, issued by the state of California was a shock to Smyth and is sobering for wineries all over the state. Volunteer workers, particularly at harvest, have long been common in the wine industry.

http://www.wine-searcher.com/m/2014/09/california-winery-fined-115-000-for-using-volunteer-workers

Plenty of college kids that I know have worked as unpaid summer interns in law firms, accounting firms, financial services, etc. It that any different?

[David M. Bueker]

Particular to California labor law perhaps?

I should have read the entire story.....

Not surprisingly, Smyth is angry. California law does allow unpaid internships when the intern is "learning something valuable," according to Melton.