Strippers Misclassified as Independent Contractors

Posted by Liz Greene

In a case that brings vivid new meaning to the “three areas of control,” the Boston Globe reported today that a judge has ruled in favor of about 70 exotic dancers who were misclassified as independent contractors by Chelsea establishment King Arthur’s Lounge. The class action case will now proceed to trial on damages, estimated to come to thousands of dollars per dancer. With such a misclassification finding, the club may now also be exposed to the full monty of independent contractor reclassification risks, including wage and hour law, immigration law, discrimination laws, payroll tax penalties, and more.

According to the Globe reporter,

The club had argued that selling alcohol is its main business, not putting on strip shows, and that the performers were independent contractors who provided extra entertainment akin to televisions and pool tables at a sports bar. Suffolk Superior Judge Frances A. McIntyre dismissed that argument. “A court would need to be blind to human instinct to decide that live nude entertainment was equivalent to the wallpaper of routinely-televised matches, games, tournaments, and sports talk in such a place,’’ she wrote. “The dancing is an integral part of King Arthur’s business.’’

Under Massachusetts law, service employees are entitled to $2.63 minimum wage and employers are not allowed to take a portion of their tips. In this case, the strippers had to pay a fee to take it all off, received no minimum wage, and were required to hand over a portion of earnings. Berluti, the attorney for King Arthur’s, is reported to have said that Judge McIntyre’s ruling reflected the fact that Massachusetts has one of the strictest laws in the country concerning misclassification of workers as independent contractors.

The case joins similar fights in Minneapolis and Indiana.