GREENBELT, Md. — A group of exotic dancers who filed and won a class action suit against the owners of two nightclubs asked a court of appeals to uphold their favorable verdict. The plaintiffs had won the suit in a federal district court and were awarded more than $265,000. The club owners of Fuego’s Exotic Dance Club and Club Extasy Exotic Dance Club in Maryland appealed the verdict to a federal court of appeals.
Misclassification
The underlying dispute started when two dancers filed suit alleging that the club owners had breached the Fair Labor Standards Act (FLSA) and Maryland state labor laws by failing to pay hourly wages. The suit also alleged that the clubs imposed unreasonable fines on dancers that resulted in unreasonable deductions to their pay. The club owners argued in response that the dancers were not covered by FLSA because they were independent contractors, not employees. The club owners’ case centered around the argument that because the women received their money directly from customers, can freely work at competing establishments, and usually supply most of their own equipment, they were not really employees.
However, the federal district court granted partial summary judgment and decided that the dancers were, in fact, employees. This is in part because the dancers were an integral part of the club’s business and there was a degree of skill required for exotic dancing.
Court Verdict and Appeal
The case then proceeded to trial, and the jury awarded damages to the dancers for a three-year period as allowed under Maryland’s state wage laws. Additionally, the federal district court ruled that the dancers were entitled to additional money under FLSA because the club owners had acted in bad faith. The jury awarded the dancers $196,956, and subsequently the federal district court added $68,320 in liquidated damages under FLSA.
The club owners appealed the entire judgment to the Fourth Circuit Court of Appeals, arguing that the district court wrongly ruled the dancers were employees and not independent contractors. Additionally, the club owners alleged that the trial court erred when it failed to give them a chance to present evidence regarding tips and fees earned by the dancers and improperly awarding liquidated damages.
Misclassification is often the primary reason why employees are not afforded the wages they are entitled to under FLSA. You should call (855) 754-2795 or complete the Free Unpaid Overtime Case Review form on the top right of this page if you believe you have been misclassified and are being deprived of your wage rights.. Our top-rated team of wage lawyers will evaluate your situation to determine your best course of action. We will also determine if it is in your best interest to file a lawsuit against your employer. There are strict time limitations for filing, so it is important that you call our experienced attorneys today.