$8 Million Independent Contractor Misclassification Class Action Settlement

In October of 2010, we reported on a federal court decision certifying a class action of adult dancers that performed services at the Penthouse Executive Club in New York City; the dancers claimed they are "employees" under federal and state laws and had been misclassified as independent contractors (ICs). They had  alleged, among other things, that the Club violated the federal Fair Labor Standards Act (FLSA) by failing to pay them overtime for hours worked in excess of 40 per week, required them to pay a "house fee" that sometimes exceeded $100 per night and deducted service charges for tips.  The claims also included alleged violations of state wage laws. Penthouse asserted as a defense that the adult dancers were ICs and therefore it did not violate any federal or state wage and hour laws that only cover "employees."