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August 25, 2011

Dancers at a hostess club in Los Angeles sued the club owners for a variety of labor law violations, alleging that they were paid only for the minutes they danced with patrons, were denied overtime compensation, and were subjected to “exploitative, substandard and degrading working conditions,” an immigrant rights advocacy group announced Aug. 17 (Hernandez v. Goliath Inc., Cal. Super. Ct., No. BC462953, lawsuit announced 6/6/11).

The lawsuit was initially filed June 6 but not served to give the defendants, Goliath Inc., which owns Club 907, and its owners, an opportunity to settle. When settlement talks broke down, the Coalition for Humane Immigration Rights of Los Angeles (CHIRLA) made the complaint public on August 17.

In their proposed class action lawsuit, the hostess dancers, also known as “taxi” dancers, because patrons pay by the minute for the time they spend with dancers, alleged they were required to work a minimum of 36 hours per week, but were paid for only a fraction of that time—and well below the legally required minimum wage rate.

The dancers also routinely worked more than 40 hours per week and/or eight hours per day, but were not paid the required overtime compensation. Club 907 failed to keep adequate records of the time worked by the “taxi” dancers, and failed to provide them with accurate wage statements, also a violation of state labor laws.

Other alleged violations included failing to provide required meal and rest breaks, unlawfully deducting wages if the dancers had to leave work early, and requiring the dancers to reimburse the club for shortages caused by patrons who absconded without paying for time spent with the plaintiffs.

Club 907 also failed to provide the dancers what the complaint called “basic workplace amenities required by law,” including a place to sit when not with patrons, or a place to consume drinks during breaks. The club prohibited the dancers from bringing food or water into the establishment, instead requiring them to buy such items from the club.

The defendants did not provide the dancers with a private place to change clothes, and also unlawfully video-taped them in the locker room where they did change clothes, the lawsuit alleged.

Club managers subjected the dancers to sexual harassment, including quid pro quo sexual propositions by managers, who also “turned a blind eye” to unwelcome sexual contact and lewd behavior by patrons, the complaint added.

The club’s conduct violated numerous provisions of the California Labor Code, applicable wage orders issued by the Industrial Welfare Commission, and California common law, the dancers alleged.

Plaintiffs brought the complaint as a class action seeking to recover on behalf of themselves and other similarly situated employees the unpaid minimum wage and overtime compensation, penalties and interest, additional compensation due for missed meal and rest periods, and damages for being subjected to sexual harassment and a hostile work environment.

The dancers also brought the case as a representative action pursuant to California’s Private Attorney General Act (PAGA), to recover the applicable civil penalties for the alleged violations of the various labor code provisions.

Voorhees said the class, which includes all hostess dancers at Club 907 from 1994 through December 5, 2010, would number “in the hundreds.”

In a statement e-mailed to BNA, Jeffrey S. Ranen, an attorney with Lewis Brisbois Bisgaard & Smith LLP who is representing Goliath, said:

“Club 907 vehemently denies the frivolous claims in this case. The Club complied with all California labor laws and the records will prove that Club 907’s employees received well more than the minimum hourly wage. The sexual harassment allegations are false and being driven by a long term, disgruntled former employee who had a falling out with her supervisor. This case is nonsense, and Club 907 intends to aggressively defend against it and expects that a court will throw out the class action allegations. The Club believes that the attorneys’ attempt to try this case in the media is a veiled effort to infuse politics into this dispute and it will not be tolerated. We expect to be vindicated by a jury.”

In November 2010, the Los Angeles Police Department served a search warrant on Club 907, and seized a number of false identification documents. The LAPD notified Immigration and Customs Enforcement (ICE), whose agents reported that during subsequent interviews, women employees of the club admitted they were in the country illegally, and that managers of the club knew that, according to an affidavit submitted in April in support of a federal criminal complaint against four club managers (United States v. Baquiax, C.D. Cal., No. CR 11-0794M, filed 4/14/11).

The affidavit noted that ICE in 2009 had received anonymous reports that Club 907 knowingly hired illegal immigrants as dancers and also that prostitution took place at the club. Voorhees said the club closed after a second LAPD raid in December 2010. 08-23-2011. Bureau of National Affairs.

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