Monday, September 8, 2014

NFL Oakland Raiders Settle Cheerleader Lawsuit

Football season is back! Penn State is 2-0, the Steelers are 1-0 and all is right with the world. The Raiders on the other hand . . . well, things haven't been going so well for them. On the field, they're 0-1 and struggled offensively. Only one game in and I've already placed them on McGloin-watch.

Off the field, the Raiders have struggled with a wage and hour lawsuit filed by the Raiderette Cheerleaders. The good news for the Raiders is that they settled the lawsuit. The bad news? It reportedly cost them $1.25 million.

Per the LA Times, the settlement also included some prospective relief:
Instead of earning only $125 per game in a single paycheck delivered at the end of the season, Raiderettes will earn $9 an hour from now on, plus overtime, for the estimated 350 hours each cheerleader puts in each year, including rehearsals, practices and mandatory community and charity appearances. Their annual compensation will rise from about $1,250 to about $3,200. 
From now on, Raiderettes will also be reimbursed for business expenses and mileage, which they had to cover themselves before. They will also receive paychecks every two weeks, per state law, rather than one lump sum at season’s end. 
And the team will no longer illegally deduct wages for minor rules infractions like showing up a few minute late to rehearsals, wearing the wrong color nail polish or failing to bring the correct pom poms to practice. Cheerleaders will also be entitled to a 10-minute break during games.
A few other NFL-cheerleader-related lawsuits remain. We'll see if they play out in court or if the franchises (or perhaps even the NFL itself) work out a settlement agreement.

For employers, this case provides a lesson: Check with an employment law attorney before deciding to not pay people who are providing services, or only paying a lump sum that doesn't even amount to minimum wage, or making deductions from paychecks. This is a tricky area of the law, and professional counsel can help.

That said, the law is often not clear and employers may have to decide for themselves whether to take on the risk associated with that uncertainty. There are generally cost benefits to treating workers as independent contractors or exempt under wag-and-hour laws - this lawsuit is a reminder of the risk involved.

Image: Raiders logo used in commentary on Oakland Raiders. Not authorized use.