A federal judge recently ruled in favor of a Maryland woman who had been working as a dancer at a nightclub for about five years when she was fired in 2012. The woman sued seeking payment for back wages since she believed she had been wrongfully terminated. The case rested on whether or not the dancer was engaged at the nightclub as an employee or an independent contractor. The judge ruled that based on the facts she was in fact an employee and therefore is entitled to compensation.
The classification of an employee versus an independent contractor is an important one for purposes of benefits, termination, workers compensation, and other types of liability.
The relationship of an independent contractor to a company or another individual is more of an arms-length transaction, which means that each is responsible for themselves and the independent contractor has the obligation to fulfill a certain task or complete a project in whatever way they see fit. An employee, on the other hand, will be subject to more supervision and control by the other party and in exchange the employee is entitled to certain benefits under the law, such as a fair hourly wage and protection from wrongful termination.
In this case the club argued that the dancers were independent contractors because they specifically agreed as such, and because they set their own hours and controlled their own performances. The judge disagreed, saying that the club’s level of control over the customers and the premises, along with the club’s reliance on the dancers to generate business made the relationship closer. One important takeaway from this case is that even though the dancers agreed to call themselves independent contractors, the court looked to other surrounding facts to determine the nature of the relationship.
Source: Baltimore Sun, “Former stripper on The Block is owed back wages under labor laws, judge rules,” Lorraine Mirabella, Nov. 8, 2013.