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Employees Including Exotic Dancers Misclassified As Independent Contractors Can Bring Unpaid Overtime Claims

The federal Fair Labor Standards Act (FLSA) provides numerous protections to employees working all over the country. These protections make sure employers don’t take advantage of their workers. In order to do this, the FLSA regulates things like minimum wage and overtime.

In addition to the federal Act, each state has their own labor laws regulating employment within the state, so employers conducting business in the U.S. need to make sure they are abiding by all the relevant local laws, as well as federal law.

There are some instances in which federal law takes precedence over local law. For example, the federal minimum wage is currently set at $7.25 per hour. If a state’s labor laws have a higher minimum wage, then all employees working in that state are entitled to earn no less than the state’s minimum wage. But if the state’s minimum wage is lower than the federal minimum wage, then employers are required to abide by the federal minimum wage.

The FLSA is also responsible for regulating overtime. It defines overtime as all time spent working after eight hours a day or forty hours a week. Employees who work overtime are entitled to one and one-half their normal hourly rate for all overtime worked, although there are some exceptions to this mandate.

Because the FLSA is designed to protect workers from their employers, its regulations don’t extend to independent contractors. This is because independent contractors are self-employed, so they presumably have more power to negotiate the terms under which they work. Because independent contractors are exempt from many of the regulations provided by the FLSA, the law is very clear about the requirements a worker needs to fulfill in order to be classified as an independent contractor, rather than an employee.

An independent contractor must have control over where and when she works, the environment she works in, and what she wears to work. In return for these freedoms, she is fully responsible for paying all her own taxes, health insurance, and social security, all of which would normally be paid for (at least in part) by the employer.

According to a recent wage and hour class action lawsuit, Scarlett’s Cabaret, a dance club chain with locations in Florida and Ohio, allegedly misclassified its dancers as independent contractors. The misclassification allegedly resulted in the dancers receiving lower pay and not getting paid the proper overtime compensation when they worked more than eight hours a day or forty hours a week.

Dancers are often misclassified as independent contractors, even though they are commonly told when and where to work, as well as what to wear while working, which places them firmly in the employee category under the FLSA.

Rather than continue to fight the legal battle, Scarlett’s has agreed to pay $6 million to settle the class action lawsuit. The settlement will cover approximately 4,700 current and former dancers who worked at the club. It is likely the settlement includes an agreement stating that Scarlett’s will no longer classify its dancers as independent contractors. This means all current and future dancers working at Scarlett’s will be entitled to employee benefits such as health care and social security.

The Chicago class action lawyers at the Chicago Overtime Law Center are investigating unpaid overtime claims by waiters and bus boys and other restaurant and hotel workers against national restaurant chains including Hilton, W, Marriott, Sheraton, Holiday Inn, Best Western, Chipotle, Red Lobster, Olive Garden, Cracker Barrel, Outback Steak House, Taco Bell, Burger King, Wendy’s and hotels for mis-classifying employees as managers or assistant managers, forcing employees to work off the clock at business, failing to share all tips, erasing or altering time sheets or time records, pressuring workers not to report or record overtime, and otherwise failing to pay workers for overtime and other wages. If you are the victim these wage theft practices call us at (312) 869-4095 or contact us online.

The Chicago class action attorneys at the Chicago Overtime Law Center have three decades of experience fighting to help employees who are victims of wage, overtime and tip theft by their employers. We have a team of Chicago unpaid overtime lawyers who concentrate on prosecuting state and nationwide class action lawsuits. Our attorneys work out of Chicago and Oak Brook offices and pursue claims for workers all over the Chicago area including Bollingbrook and Jolet. We protect unpaid workers who haven’t received overtime throughout the Chicago area including in DuPage, Lake, McHenry, Kane and Cook Counties.

Our West Chicago, Glen Ellyn and Carol Stream overtime lawyers are intimately familiar with the issues that arise during wage claim litigation, and we know the laws that govern overtime cases well. Many employers mis-classify employees as being exempt from overtime laws and pay workers salaries instead of hourly wages in order to avoid paying them overtime. Some employers mistakenly classify employees as exempt and others intentionally do so in order to circumvent the law. In either case, workers do not receive the wages they should, and a lawsuit may be the only way to recover their earned wages.

The Chicago Overtime Law Center is based in Chicago, and represents clients throughout the country who have unpaid overtime and other employment right claims.