New York Dancers Win $10.8 Million Lawsuit

Regional Correspondent: North America and the Caribbean

In the United States, the practice of paying for the right to work a shift at a strip club is widespread. Dancers at most of what are considered “upscale” clubs run the risk every night of leaving empty handed, or even in debt, after handing over “stage fees” of $50-100, and in some cases even more, at the beginning of each shift.<--break->For some, however, it is a risk worth taking when the potential reward is a hefty payout at the end of the night.

Last week, a group of dancers at Midtown Manhattan’s Rick’s Cabaret won a class-action lawsuit against the club, charging they were employees who should have been paid a minimum wage. The lawsuit also complained that dancers were required to pay a $60 stage fee per shift, and that the club also collected $2 of every $20 “Dance Dollar” customers bought with their credit cards to pay for lap dances – fairly standard practice in the United States, where it is also expected that a dancer dip into their earnings to tip everyone from the DJ to the bouncer to the wait staff.

The club had tried to argue that the money earned by the dancers was enough to offset the fees they were charged. However, Manhattan Federal Court Judge Paul Engelmayer counter-argued that that money was paid directly to the dancer by the customer and should be hers to keep. Engelmayer also noted that the club already takes a healthy cut from private room fees.

In his 51-page ruling,” reports the New York Daily News, Engelmayer took aim at the club’s “Dance Dollar” policies.

“If the customer paid cash to the dancers, he noted, the dancers would get to keep 100% of the money, but if they paid by credit card and bought “Dance Dollars” for the tips, the club would keep $2 of ever $20, in addition to charging the customers a $4 fee… The judge said that was misleading, because customers would think the dancers were getting the full $20.

“A reasonable customer would have understood the performance fees, which customers paid dancers as gratuities belonging to particular dancers, not as service charges belonging to the club,” he found.

Engelmayer ordered the club to pay $10.8 million in damages for minimum wage violations and improperly retaining tips. The club may be liable for even more at trial when the dancers’ complaints about mandatory stage fees are aired.

For the past couple of decades, strippers have been divided on the issue of their status as “independent contractors.” In theory, independent contractor status means being able to set your own hours and work for yourself, but in practice strippers are often required to keep strict hours (with heavy fines for lateness or leaving early) and adhere to club-imposed standards, such as style of dress and hair etc… While obvious workplace violations occur regularly at strip clubs, many dancers would prefer to maintain their independent contractor status than to be classified as an employee who is paid an hourly wage. The reason being that those dancers would rather depend on their hustling skills to make a big chunk of cash than rely on a pitiful hourly wage.

In an article from 2012, activist and writer Rachel Aimee describes a scenario at a strip club where she worked where, in response to dancers organising against house fees, club management revoked the dancers’ right to sell lap dances, thus taking away their primary means of income. Aimee also quotes dancer Pussy Per Se’s response to the successful 2009 class action lawsuit against King Arthur’s Lounge in Chelsea, Massachusetts, which lead to a number of other suits across the state: “I was an independent contractor working at half a dozen clubs, making good money. It was a perfect job for a single mom. I could arrange my schedule around my son’s, … I might work at a single club for weeks, … [or] I might take a break to go on a road trip with another dancer, reaping the benefit of being ‘new girls’ at a distant club.” But as an employee, she writes, she has lost this freedom in exchange for the security of being a “wage slave.”

Nevertheless, dancers across the country continue to file lawsuits against strip clubs, on the grounds that they are treated as employees, not independent contractors, and so should receive wages and not have to pay to work. In the majority of cases, courts rule in favor of dancers, who are awarded compensation for house fees they have paid out over the years, as well as the back wages to which, as employees, they are entitled.

Rick’s Cabaret plans to appeal the ruling.