NEW YORK — Rick's Cabaret will pay adult entertainers up to $15 million in a settlement resolving a lawsuit claiming they were employees unfairly classified as independent contractors.
The settlement, announced today, came after a federal judge in November awarded about 2,000 Rick's Cabaret New York club dancers $10.9 million and in front of a April 27 trial over further amounts they had sought.
"Based on response rates seen in other class actions of this nature, we anticipate that the ultimate amount paid will be between $9.5 million and $12.5 million, but the precise amount will not be known until the response period ends," Eric Langan, CEO of parent operator RCI Hospitality Holdings, said in a statement.
In 2013, a federal judge ruled that Rick's Cabaret exercised so much control over the dancers that they were actually employees subject to club rules and could not make independent decisions about their work. The strippers did not receive salaries, only tips and fees for dances.
As employees they were entitled to minimum wage protections under federal law, the court ruled.
Langan noted that since 2009 Rick’s Cabaret clubs have taken steps to avoid these types of cases going forward and have been successful in having such cases dismissed.
The Rick's Cabaret New York settlement is subject to the court's approval.
