Tuesday, November 18, 2014

Dancers Win Classification Fight with Strip Club

There are a lot of thing you won't find in strip clubs . . . like clothes. But strangely, you find a ton of employment law. In particular, there are a lot of classification issues.

Employers have a lot of reasons for classifying workers as independent contractors instead of employee - no wage and hour compliance, no payroll taxes, less liability when they do something wrong, and they're generally not covered by protective employment statutes (like anti-discrimination laws). So, strip clubs have really been pushing the limits of what is a proper classification.

CNN Money reports that a class of 1,900 dancers (or "strippers" as the article calls them) won a big court battle recently. The Court ruled that they were employees who deserved minimum wage. The Court's analysis focused on the "degree of control" the clubs had over the dancers. From the article:
[Judge] Engelmayer said that the club's "entertainer guidelines" and the fines it levied if workers violated them "operated as a sword of Damocles over the dancers" and served as "strong evidence" that they were employees, not independent contractors. The guidelines "exerted significant control over its dancers' behavior," he said. 
Workers had to wear heels at least four inches high, for example, and had to cover up all tattoos. They couldn't chew gum, wear the same dress two days in a row, or any sort of body glitter. 
Dancers had to pay the club a range of fees, including a nightly "house fee," and at least $20 of their tips. Workers would be fined or fired if the fees went unpaid.
Apparently, some of the dancers actually lost money on some shifts. According to another CNN article (they dedicate a lot of resources to the important stories!), the damages could be in the neighborhood of $10 million.

And, finally . . . I swear I was gonna use this before Jon Hyman tweeted it at me . . . no word yet on whether the judgment will be paid in 1s (ba dum ching).

HT: Mike Chittenden via email - he knows the kind of cases I like (by which I mean wage and hour cases of course).