NU Online News Service, May 27, 3:31 p.m.EDT

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Labor officials properly determined that a strip club can'tclaim its nude and topless dancers are private contractors, ratherthan wage employees covered by workers' compensation law, theMontana State Supreme Court has ruled.

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The finding by the high court came as part of a decision in acase brought by four exotic dancers against the Playground Loungeand Casino in Great Falls, Mont.

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The Playground operated by TYAD Inc. had at one point paid itsdancers $5.15 an hour to perform in the lounge, but required themto pay the club a $5 fee for each lap dance they negotiated with acustomer and $10 for each "hostage" dance, the decisionrecounted.

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But on Jan. 1, 2003, the club had dancers sign a "RentalAgreement" calling them independent contractors and requiring themto pay "rent" fees for the stage and dressing room every night.Initially they were allowed to keep all tips and dance fees, butlater the club began requiring dancers to pay $10 after eachhostage dance.

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The dancers eventually began proceedings to get thousands ofdollars in regular and overtime wages and reimbursement of thestage fees.

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Their case went before the state Department of Labor andIndustry, the Department's Independent Contractor Central Unit andeventually the District Court of the Eighth Judicial District. Thedancers were found to be employees, covered by workers'compensation law.

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In their decision, the Supreme Court noted that the agreementsthe dancers were made to sign were designed by TYAD to "circumventMontana wage laws and to secure the services of the dancers in amanner that financially benefitted the Playground."

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"It can be logically concluded that the stage fees were paidfrom the only remuneration the dancers received–their tips and theportion of private dance fees they were allowed to keep. Somedancers testified that they did not earn enough in tips and dancefees on some nights to make up for the stage fee they werecharged," the decision said.

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The court's opinion also found "not only did TYAD fail to paythe dancers earned wages; it demanded payment for providingessential elements of employment to the dancers, i.e., a stage anda dressing room."

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The Labor Department Wage Unit had found that the stage feesconstituted illegal kickbacks that had to be repaid to thedancers.

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While the court found mostly for the dancers, it did revise someof the amounts that the club was found to owe them.

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