The Spearmint Rhino dancing clubs in Las Vegas recently settled an employee misclassification lawsuit filed by dancers at the club. The dancers claimed they were wrongfully classified as independent contractors at the club and did not receive the proper wages and benefits entitled to full-time employees.
The allegations against the Spearmint Rhino included claims that dancers were classified as independent contractors instead of employees. The misclassification led to the dancers not receiving proper minimum wages and other benefits guaranteed to them under state and federal law. Dancers also claimed they were forced to comply by the same work rules and policies as the club’s regular employees.
Allegations in the lawsuit also claimed that the club had unlawful rules for splitting tips among dancers. Dancers claimed the club forced them to split their tips with managers and other employees, which included DJs and doormen.
The Spearmint Rhino settled the lawsuit with the dancers, which included the same types of allegations from their other clubs in California, Nevada, Florida, Idaho, Kentucky and Texas. As part of the settlement, the Spearmint Rhino agreed to stop classifying dancers as independent contractors and will now list them as employees. The club said they will treat dancers in the same way they treat employees, shareholders and partners.
This lawsuit and settlement is an example of the ways companies can be held liable for misclassifying contractors and employees. Businesses can benefit from working with attorneys experienced in business and employment law to ensure they are classifying their employees correctly.
Following employment and business laws properly will help keep businesses from facing allegations and lawsuits that can be costly and damaging to their reputation.
Source: Vegas Inc, “Spearmint Rhino settles lawsuit by dancers for $12.9 million,” Steven Green, Oct. 10, 2012
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