Independant Contractor or Employee? The Strippers Ruling
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The last time you went to an "adult entertainment" venue (no one reading this blog, I'm sure), did you think the "dancers" were independant contractors or employees of the venue. What...you weren't thinking about that? Well...if you're an employer, you'd better start thinking about it.
On August 6, a Superior Court Justice ruled that 70 exotic dancers were employees and not independant contractors, and further ruled that the employer violated the Massachusetts Employee Classification Law by misclassifying the stripper/employees. The dancers, employed at King Arthurs Lounge alleged they were "service employees" entitled to earn wages and keep their tips. The employer argued that the dancers only provided an "independant service" that was not an essential part of the business. The judge said that this was a "thinly veiled" argument (yes; he used that language) and that the dancers provided a service "integral" to the conduct of the business.
Of course, the employer will appeal. However, the law itself does contain a relatively stringent three part test. If the employer fails to meet even one part of the test, the worker will be considered an employee; not an IC:
a) The worker must be free from the employers presumed control and direction in performing the service;
b) The service must be "outside" the employers usual course of business, and;
c) The worker must be customarily engaged in an independant trade, occupation, profession or business of the same type.
The statute, M.G.L ch 149, Sec.148B provides for both civil and criminal penalties.
Every employer that uses Independant Contractors MUST review their relationships with staff to insure that they are not violating the law. Failure to do so may result in you being "stripped" of some significant cash.
Bruce A. Bierhans