In a recent opinion by the U.S. District Court for the District of Columbia, five exotic dancers were found to be employees of the club that they danced at, entitling them to minimum hourly wages and overtime compensation. See Thompson v. Linda & A., Inc., 2011 U.S. Dist. LEXIS 46078 (D.D.C. Apr. 29, 2011). In Thompson, the defendant classified its dancers as independent contractors and paid them $40 per 10 hour shift plus tips. The plaintiffs argued that despite the independent contractor classification, they were in fact employees entitled to the protections of the Fair Labor Standards Act. The Court performed an economic realities test and sided with the dancers. Specifically, the Court found that: (i) the club asserted significant control over the dancers; (ii) the dancers did not have the opportunity for profit or loss and investment in the business; (iii) the dancing did not require a degree of skill and independent initiative to be independent of the club; and (iv) the dancers were an integral part of the employer’s business. Thus, the club was responsible for paying dancers minimum wages for each hour worked and overtime premium pay for hours worked over 40 in a single week.
The improper classification of exotic dancers as independent contractors is a common practice. Other types of employers will also do the same in order to avoid their responsibilities of paying workers minimum wage and overtime pay.