I'm not aware of it being illegal per-se, ie criminal. But there is some rather strong evidence that volunteers for a for profit company, if treated like an employee (time cards, minimum work hours, training, etc.) would probably be able to successfully sue for back wages and penalties.

http://en.wikipedia.org/wiki/AOL_Community_Leader_Program

In February 2010, the United States for the Southern District of New York gave preliminary approval to a settlement between AOL and the Community Leaders totaling 15 million dollars. Final approval was granted in May 2010.

(Good luck to the OP, I know that situation can be rough)

It's basically a PITA for corporate taxes for a company to accept free work that contributes to their bottom line, as well as the AOL case noted elsewhere.

I think the idea is volunteer work at a for profit company.