It’s a happy ending for the ladies of the house!
A federal judge ruled Tuesday that a Midtown strip club ripped off its exotic dancers by classifying them as independent contractors – not in-house employees – to avoid paying them minimum wages.
Former strippers filed a $5 million-plus class-action lawsuit in 2009 against Rick’s Cabaret and parent company RCI Entertainment New York, alleging the club violated federal and state labor laws by failing to pay them a salary. Instead, the dancers said they were paid directly from customers – including “performance fees” for private lap dances.
“The Court finds that the performance fees charged by Rick’s NY were not service charges. They were, instead, tips. Accordingly, the fees cannot be used to satisfy Rick’s NY’s statutory wage obligations, “ Manhattan federal Judge Paul Engelmayer wrote in his decision.
Rick’s had contended that it “exercised minimal control” over the dancers, and the club had counter-sued claiming the dancers’ “performance fees” should count towards any statutory wage obligation by Rick’s.
Engelmayer in his decision also shot down Rick’s claims, concluding honchos there “regulated almost every aspect of the dancers’ behavior within the club,” including forbidding cell phone use and gum chewing while giggling for wide-eyed customers.
He also ordered both sides to meet about the potential of a settlement.