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Thread: Zero Tip Out and No Fines

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    Default Zero Tip Out and No Fines

    How do you girls feel about a zero tip out as an employee, but you fork over 50% of everything plus a guaranteed minimum $3.50/hr (minimum hourly required per tipped employee, depending on your state)? Sound fair?

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    Default Re: Zero Tip Out and No Fines

    As an independent contractor clubs cannot legally force you to tip anyone out, but unfortunately they do get away with it. There are clubs that do not have mandatory tip outs, and have different ways of collecting their "cut" from the girls.

    $3.50 an hour? Sounds kind of like a waitressing or valet job. If I make $300 in a night I really don't want to hand the club $150 because I am promised $22 or so in wages after taxes for my eight hour shift. I'd prefer to pay a $60 house fee or base rent (like they have at Deja Vu in Ypsilanti, MI) ten to one.
    If you are willing to do for one year what other's won't, you can spend a lifetime doing what other's cant.


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    Default Re: Zero Tip Out and No Fines

    I've never heard of a club that makes dancers tip a rate of 3.50$ an hour.
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    Default Re: Zero Tip Out and No Fines

    I do not like percentage systems. To me, it always feels like I am being punished for doing well.

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    Default Re: Zero Tip Out and No Fines

    Quote Originally Posted by Djoser View Post
    I've never heard of a club that makes dancers tip a rate of 3.50$ an hour.
    The dancer gets $3.50 per hour plus 50% commission of every dance. In the restaurant industry waitresses are considered tipped employees, thus are allowed to be paid an hourly below minimum wage as long as the tips they receive can exceed minimum wage.

    There's been a huge number of lawsuits over the past year about reclassifying dancers from independent contractors to employees, and states seem to be jumping on this bandwagon to close their tax gap. This trend can potentially accelerate with budget deficits getting worse every year at the federal and state levels. The worst situation for a club would be for a reclassification to occur over many years across hundreds of dancers and other workers, which would effectively bankrupt the club. Larger clubs are more vulnerable than smaller clubs because contingent fee attorneys can extract a much larger settlement from the larger ones.

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    Default Re: Zero Tip Out and No Fines

    You do know that fining any employee or independent is completely illegal, right? Everything you need to know about federal labor laws you can find here: http://www.dol.gov/compliance/guide/index.htm. I've used that site a ton when doing economic research for hypotheses I made.

    The anti-fining thing dates back to the industrial revolution and original formation of labor unions. It came about the same time child labor laws and workplace safety practices started being used. Since civics and labor history isn't really taught in public school anymore, most people are unaware of it.

    And, trust me, dancers do talk amongst themselves about this situation. We call it the "stripper retirement fund" and know that we can later sue the club to get all of our fees, fines plus any back wages back in a law suit. There have been plenty of such suits over the last 20 years or so (whenever clubs started charging dancers to work) and in every single case the dancers won their case. I've known girls that have worked at clubs that paid the federal minimum wage and sued to get back house fees, mandatory tip outs and her percentage of her dances ($5 per $20 dance). Just run some numbers and decided what is the bigger financial risk, running girls as employees and or the risk of legal action, even a legal class action suit in the future.

    I know that I've personally paid out up to $1.5K in one month to a club. I danced for 9 years. Plus I worked 30-40 hours a week. In tip outs and house fees alone that is over a hundred thousand dollars, and I'm just 1 dancer!

    It is really tough to make a buck as a club owner these days. I've been warning people away from the club model in this economic environment because people are getting desperate for cash, and suing a strip club seems to be more appealing all the time.

    That is why I've decided to stick with the private party booking agency and not go into running a club. It is a good wy to end up bankrupt or in jail in today's economic climate. Wait a couple more years, maybe after the 2012 elections and reassess what the politics and economy are doing at that time, then jump into club ownership.

    In the meantime, a good karoake bar is a safer and more profitable route (unless you need a tax write off, that is).


    Promote yourself and earn more money! This is a business that is owned by strippers for strippers. Let's make that money!


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    Default Re: Zero Tip Out and No Fines

    One club in WV that my favorite left had a $30 stage fee Mon-Thurs, $40 Fri-Sat and the club took half of everything, drinks, dances, rooms.
    I can do better than you in a two bit fancy house

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    Default Re: Zero Tip Out and No Fines

    Quote Originally Posted by Paris View Post
    You do know that fining any employee or independent is completely illegal, right? Everything you need to know about federal labor laws you can find here: http://www.dol.gov/compliance/guide/index.htm. I've used that site a ton when doing economic research for hypotheses I made.

    And, trust me, dancers do talk amongst themselves about this situation. We call it the "stripper retirement fund" and know that we can later sue the club to get all of our fees, fines plus any back wages back in a law suit. There have been plenty of such suits over the last 20 years or so (whenever clubs started charging dancers to work) and in every single case the dancers won their case. I've known girls that have worked at clubs that paid the federal minimum wage and sued to get back house fees, mandatory tip outs and her percentage of her dances ($5 per $20 dance). Just run some numbers and decided what is the bigger financial risk, running girls as employees and or the risk of legal action, even a legal class action suit in the future.

    I know that I've personally paid out up to $1.5K in one month to a club. I danced for 9 years. Plus I worked 30-40 hours a week. In tip outs and house fees alone that is over a hundred thousand dollars, and I'm just 1 dancer!
    I know fines, house fees, and tipouts are disallowed for employees, but not sure about independent contractors. I disagree with not being able to assess a percentage of dances. If strippers are considered employed salespeople, and dancing service is what they are selling, the club most certainly has a right to take a mutually agreed-upon percentage of dances as long as the dancer earns at least minimum wage. This is how in-house commissioned sales people are treated.

    By the way, corporate limited liability would shield the club from excessive legal payouts, unless the corporate veil was pierced. Additionally, if there is a reclassification from IC to employees, wouldn't the government would be first in priority to collect taxes? Would this leave enough for the "stripper retirement fund" after Uncle Fed has his cut? If many dancers did not pay taxes on their earnings, they may have to reconsider being involved in the lawsuit. In the end, I think the primary beneficiary would be the lawyers and the government. Clubs and strippers both lose in a lawsuit.

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    Default Re: Zero Tip Out and No Fines

    When I started dancing I worked at a club that paid us a wage and had no tipouts. Sounds good until you realize that you had to fork over 50% of every dance you got. Another club paid a high wage every night cash and no tipout to anyone, but what they didn't tell you was you had to sell so many dances/rooms, etc before you'd see money. This club I remember I sold several VIPs in a night. I was so happy thinking I would walk out with tremendous amount of cash. Nope, I didn't make the minimum so just got the salary. I went back to working at the clubs where you tip out because I made more money. Dancers that hustle (That's me) tend to do better in tip out clubs, whereas lazy dancers do better making a salary.

    I do think that it's wrong for a club to have house tipouts, etc, yet still take a huge percentage of dances. I briefly worked at a club with a $50 house fee, yet you still had to tipout the DJ, bouncers, etc and hand over 50% of your dances. That's called fleecing the dancers.

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    Default Re: Zero Tip Out and No Fines

    In Texas, I was used to paying about $15-50 to work, depending on time I came in. Tipouts were usually $20 minimum total, to a number of people, including the DJ, but I always gave out at least $40 ($20 to DJ, $20 to bouncers), which paid off immensely for me gaining favor with staff.

    So, if I averaged $500 for a 5-6 hour shift (came in at 7pm, $30 housefee), in stage/lapdance commissions, I would take home ~$430 (before tax). IF...I used the OP's formula...I would get $271 take home.

    I prefer my method, since I seldomly ever made below $200 a shift. And when I did, my "social capital" with the staff served me well, and they would let me wave house fees since I always tipped well, was a hard worker, and never brought in any drama.


    I did, at one time, work in a place where the money was made mostly by selling champagne and drinks. Lapdances and VIP area were a 50% split. But we got something like $60 a night base pay. So, it was about $10 an hour just for showing up and looking pretty. With a reasonable base pay (NOT 1/2 min wage) I'd be willing to consider a split.

    Other than that, I will hustle hard and establish a superior working relationship with the staff and management of my club.

    I've never EVER once left in the hole of any club. In fact, I've never left with less than ~$150 in my pocket, and that was for less than 3 hours of work, and going home early, too many girls, no custies in the club. Why change that to become an employee?

    Also, I've never worked at a club that fined. One club did do a $20 fine to a dancer who missed a stage set. However, that dancer had to pay the dancer before or after her the $20, since the club had a "girl on main stage at all times" rule, so the previous dancer would be stuck staying onstage, or another dancer would have to stop hustling to jump on stage. I thought that was a very fair fine, because this club was perfectly organized about stage rotation, so every dancer would know exactly when she was up with plenty of time to prepare.

    I don't think I would work in a club that fines, under any circumstance except for dire need.

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    Default Re: Zero Tip Out and No Fines

    Quote Originally Posted by 1st_samurai View Post
    How do you girls feel about a zero tip out as an employee, but you fork over 50% of everything plus a guaranteed minimum $3.50/hr (minimum hourly required per tipped employee, depending on your state)? Sound fair?

    Sounds like I'd be getting screwed, plus with an employee, they usually want to put you on a schedule. No thanks

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    Default Re: Zero Tip Out and No Fines

    Quote Originally Posted by 1st_samurai View Post
    I know fines, house fees, and tipouts are disallowed for employees, but not sure about independent contractors. I disagree with not being able to assess a percentage of dances. If strippers are considered employed salespeople, and dancing service is what they are selling, the club most certainly has a right to take a mutually agreed-upon percentage of dances as long as the dancer earns at least minimum wage. This is how in-house commissioned sales people are treated.
    I agree with this, but I know 3 dancers personally that were able to retrieve their $5 per dance through their legal case. It could be because the club considered the dance fees tips, and therefore didn't have to pay the taxes and FICA on those amounts as income to the dancer.

    Quote Originally Posted by 1st_samurai View Post
    By the way, corporate limited liability would shield the club from excessive legal payouts, unless the corporate veil was pierced. Additionally, if there is a reclassification from IC to employees, wouldn't the government would be first in priority to collect taxes? Would this leave enough for the "stripper retirement fund" after Uncle Fed has his cut? If many dancers did not pay taxes on their earnings, they may have to reconsider being involved in the lawsuit. In the end, I think the primary beneficiary would be the lawyers and the government. Clubs and strippers both lose in a lawsuit.
    You'd have to do a little research on this, as I'm not sure off the top of my head how that works. All I know is that 3 girls I've known personally at 3 different clubs got tens of thousands of dollars from their law suits. There is legal precedent in Alaska, Oregon, Montana and California that I know of for certain.

    Of course taxes would be owed, but the employer is responsible for a portion of the employees' social security taxes--I think it is about 7% of total wages the employer pays and the employee pays the other 7%. I also believe the employer is responsible for paying unemployment insurance as well as medicare taxes and workman's comp insurance. That's why I recommend you take your chances and go with a booking agent and rotate out your dancers. That method would minimize your risk of potential loss, although reduced risk comes also with smaller profit margins.

    1st_Samurai, you really need to get some business accounting advice as well as seek out some legal council. It is important in this industry to know what you are doing and fully understand the risks you are taking. Ignorance of the law is of no protection to club owners or dancers. Local politicians and municipalities love a good witch hunt, and sexually oriented businesses make excellent targets.

    Some club owners that you should seek out for advice would be the owners of the Star's Cabaret chain here in Oregon, The Lodge in Dallas, TX, Fred's Lounge in Missoula MT, Scarlett O'Hara's in Sioux Falls, SD and if possible talk with the owners of the big chains like Rick's Cabaret (who happens to be dealing with a class action issue right now) or Deja Vu clubs.

    All of these businesses have been involved in legal battles and have come out on top. Learn from them and make wise business decisions based on the past mistakes of others.


    Promote yourself and earn more money! This is a business that is owned by strippers for strippers. Let's make that money!


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    Default Re: Zero Tip Out and No Fines

    I think no. Do you want to know why? Its way too complicated to keep track of it. Crazy Horse II used to tell the girls to tip out 10% but the ones that paid it were unfairly punished and the ones that lied paid out less..

    I have also worked at clubs where they count out every lap dance. And you can't do the dance until the customer buys the ticket. This ruins the flow- I rarely get stiffed and if I do I just figure it happens once in a while. It doesn't compare to the amount of money I will lose by stopping every 3 minutes and running to pay the bouncer.

    Some clubs take a portion of your lapdance money but not your total profit. I think its best if the club takes $5 for every lapdance but allows the dancers to do multiple dances in a row and pay at the end.

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    Default Re: Zero Tip Out and No Fines

    At Deja Vu in Ypsilanti, MI this is how it works:

    No mandatory tip outs, manager cannot accept tips.
    No "house fee", just a $5 base rent.
    The club takes 1/3 or 33% of what you make from VIP, fantasy booth and lap dance sales.

    I've been told most girls tip out the doorman that walks them to their car and the DJ. A waitress now and again if they assist with a sale. There are no bouncers, doormen and the managers act as security. No valet either.

    Alright, let's say it's $15 dance night. You sell 5 dances your entire shift (for the sake of small numbers). At the end of the night you owe the club your $5 base rent and $5 from each $15 dance, ($5 is 1/3 of $15) which is $30 total. You would keep $50 from the lap dances themselves, plus whatever tips you make. I don't think that's a bad system. If you sell about twelve dances in a 7-9 hour shift (which is what the shifts are, length varying by day) then you should easily make $200 with tips. I think that seems pretty satisfactory, and that doesn't even include the possibility of VIP or fantasy booth sales which will make you more $ quicker.
    If you are willing to do for one year what other's won't, you can spend a lifetime doing what other's cant.


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    Default Re: Zero Tip Out and No Fines

    $225 - $75 - $5 - $10 (for DJ and doorman) = $135.

    Dancer would have to make $65 in stage tips and lapdance tips to make over $200. Not sure how MI works, but that's not common in Texas. Maybe it can be attained from a 7-9 hour shift on a Friday though, but its tough.

    Let's do this Tx style, and we still have a $15 LD night, same amount of dances sold. However, housefee is flat $30, and dancer tips out $40 to various parties. $225 - $70 = $155. Not much difference, and I'd see how the % taken per dances sold can be advantageous to someone who doesn't sell many dances.

    Now, imagine it done the way proposed. Same amount of dances sold. Dancer works 8 hours and gets her paycheck. So...$225 * .5 = $112.50 + $28 = $140.50

    My way still wins! And the nice thing about having a "tip out" system in a good club, is that the people you tip will understand if you tip them less on a slow night, if you overtip them on a good night. Not all clubs work this well though, there are greedy bastards all over the place.

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    Default Re: Zero Tip Out and No Fines

    I'd rather tip out than have to give up money as a %.

    That said I try to sell a minimum 2 - 3 lapdances an hour. (But usually hit more)

    Dances are $20, lets say I sold 17 dances over an 8 hour period.
    $20 * 17 = $340. If the club got 30% of that I'd only have $238. But if it was only after house fee ($30) and tip outs ($10), I'd have $300 left.

    'Nuff said.

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    Default Re: Zero Tip Out and No Fines

    I guess I'm just too scared that I won't make enough money dancing in this economy to use anything but a percentage system, and I'd hate to have a night where I actually left with less money than I had BEFORE I started working.

    I adjusted to the percentage system because I've known that was where I was going to audition for many months. The club has an advantage in that it's virtually the only drug and prostitution free club in my area, so I'll deal with any pitfalls that come with it.
    If you are willing to do for one year what other's won't, you can spend a lifetime doing what other's cant.


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    Default Re: Zero Tip Out and No Fines

    I worked at a place that actually only took a percentage off your first 5 dances. They also had a housefee, but it was waived if you scheduled yourself a week in advance, pretty nice.

    Dances were $25 at this place...SO....the first 5 dances, you only make $20, then the rest of the money is all yours. I really liked that, since I was used to $20 dances anyway. The DJ and bouncer tipouts were about $30 total, as well. SO....basically, only 1.5 dances actually go to the house AND if the dancer has a really bad night and a good relationship with DJ/bouncers, they can let her pass on the $30, negotiate something less.

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    Default Re: Zero Tip Out and No Fines

    Quote Originally Posted by KS_Stevia View Post
    $225 - $75 - $5 - $10 (for DJ and doorman) = $135.

    Dancer would have to make $65 in stage tips and lapdance tips to make over $200. Not sure how MI works, but that's not common in Texas. Maybe it can be attained from a 7-9 hour shift on a Friday though, but its tough.

    Let's do this Tx style, and we still have a $15 LD night, same amount of dances sold. However, housefee is flat $30, and dancer tips out $40 to various parties. $225 - $70 = $155. Not much difference, and I'd see how the % taken per dances sold can be advantageous to someone who doesn't sell many dances.

    Now, imagine it done the way proposed. Same amount of dances sold. Dancer works 8 hours and gets her paycheck. So...$225 * .5 = $112.50 + $28 = $140.50
    My way still wins!
    The $140.50 in your example would be your gross paycheck. On top of that the club would have to pay for 1/2 of your social security and medicare, disability, worker's comp benefits, not having to tip out the staff, payroll service to handle those issues, and possibly even a uniform allowance for workers considered employees. These costs/benefits add 25% to that $140.50, so you're actually "getting" $175.63. Clubs and dancers both would prefer to keep the IC arrangement, and clubs do win in a good number of court cases, but the contingent attorneys, IRS, and States continually fight it. They see independent contractors "as a disease that needs to be cured."
    Last edited by 1st_samurai; 01-27-2010 at 01:36 PM.

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    Default Re: Zero Tip Out and No Fines

    Quote Originally Posted by Laurisa View Post
    I guess I'm just too scared that I won't make enough money dancing in this economy to use anything but a percentage system, and I'd hate to have a night where I actually left with less money than I had BEFORE I started working.

    I adjusted to the percentage system because I've known that was where I was going to audition for many months. The club has an advantage in that it's virtually the only drug and prostitution free club in my area, so I'll deal with any pitfalls that come with it.
    Yeah I remember the thread where we were talking about this. I don't blame you a bit. God knows Detroit was bad enough with the extras even before the shit hit the fan after I left almost 5 years ago. And the Ypsi Deja Vu is a clean, well-run club.

    After you get comfortable enough to maybe want to try dancing in a different area (like with better economic conditions, maybe a bit warmer lol--and cleaner!), you might find you have a hard time going back to the Vu way of doing business. OTOH, I have known a few dancers who still like the chain. To each their own.

    I'm really glad it's going well for you!
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    Default Re: Zero Tip Out and No Fines

    Quote Originally Posted by 1st_samurai View Post
    The $140.50 in your example would be your gross paycheck. On top of that the club would have to pay for 1/2 of your social security and medicare, disability, worker's comp benefits, not having to tip out the staff, payroll service to handle those issues, and possibly even a uniform allowance for workers considered employees. These costs/benefits add 25% to that $140.50, so you're actually "getting" $175.63. "
    Not really. The only compelling argument for this 25% value I can see is the FICA payoff. However, even though I.C. has to pay self-employment tax, she can deduct various expenses against it that she could no longer do as an employee...such as costumes, mileage, etc. Depending on the dancer's situation, and how business tax saavy she is, she can find 15% of her income - 1/2 S.E. tax deduction to be expenses, and deduct it.

    No club is going to provide disability for their dancers. Also, in my state, employers are not required to pay into Worker's comp as long as the employee signs a waiver.

    Also, I am not responsible for payroll services, that has always been the club's expense. I can buy my own outfits on the cheap, don't need an allowance, I have enough outfits, would rather receive an allowance for health care plan.

    I understand that we wouldn't have to tip out staff, that doesn't add to the value for me, because I'd rather REASONABLY tip out staff myself rather than lose 50% of my lapdance earnings.

    Not sure where you got this 25% added value, but I see far less.

    I just can't see the benefit, unless the club would also help subsidize health insurance benefits through a guaranteed/simplified issue group plan.

    And, finally, you are assuming that a stripper would conversely report ALL her income, hence having the employer pay FICA is a big help. Most strippers do not report all of their cash tip earnings. Not that we are immoral, its just so easy to do. And as long as large purchases are made with reported income, and the dancer doesn't live quite obviously above her means, the chances for audit are slim.

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    Default Re: Zero Tip Out and No Fines

    Quote Originally Posted by 1st_samurai View Post
    The $140.50 in your example would be your gross paycheck. On top of that the club would have to pay for 1/2 of your social security and medicare, disability, worker's comp benefits, not having to tip out the staff, payroll service to handle those issues, and possibly even a uniform allowance for workers considered employees. These costs/benefits add 25% to that $140.50, so you're actually "getting" $175.63. Clubs and dancers both would prefer to keep the IC arrangement, and clubs do win in a good number of court cases, but the contingent attorneys, IRS, and States continually fight it. They see independent contractors "as a disease that needs to be cured."
    Actually, if the benefits come out to 25%, then why not just take 25% of our dances for your "costs"? Fuck the 50%!!

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    Default Re: Zero Tip Out and No Fines

    Quote Originally Posted by KS_Stevia View Post
    Not really. The only compelling argument for this 25% value I can see is the FICA payoff. However, even though I.C. has to pay self-employment tax, she can deduct various expenses against it that she could no longer do as an employee...such as costumes, mileage, etc. Depending on the dancer's situation, and how business tax saavy she is, she can find 15% of her income - 1/2 S.E. tax deduction to be expenses, and deduct it.

    No club is going to provide disability for their dancers. Also, in my state, employers are not required to pay into Worker's comp as long as the employee signs a waiver.

    Also, I am not responsible for payroll services, that has always been the club's expense. I can buy my own outfits on the cheap, don't need an allowance, I have enough outfits, would rather receive an allowance for health care plan.

    I understand that we wouldn't have to tip out staff, that doesn't add to the value for me, because I'd rather REASONABLY tip out staff myself rather than lose 50% of my lapdance earnings.

    Not sure where you got this 25% added value, but I see far less.

    I just can't see the benefit, unless the club would also help subsidize health insurance benefits through a guaranteed/simplified issue group plan.

    And, finally, you are assuming that a stripper would conversely report ALL her income, hence having the employer pay FICA is a big help. Most strippers do not report all of their cash tip earnings. Not that we are immoral, its just so easy to do. And as long as large purchases are made with reported income, and the dancer doesn't live quite obviously above her means, the chances for audit are slim.
    Alcoholic bikini clubs tend to charge less for admission and have lower tipouts because they make money off the booze, but you have some drink minimums you got to sell, otherwise get fined. Pure lap dance juice/soda clubs charge a lot more for admission and will ask dancers for higher tip outs because their only source of revenue is from dances. That being addressed, we are referring to a juice club.

    KS_Stevia, I agree with what you are saying, but maybe you can play a little devil's advocate. Say you've accumulated the *dancer's wealth* and you've decided the best thing to do is invest in the thing you know best, a gentlemen's club! You put in a pretty penny. Hypothetically, you also decide it's better to hire dancers as employees because the most recent lawsuit in your state resulted in a reclassification of dancers from ICs to employees with enormous penalties to the club that lost the lawsuit. Additionally, you're now responsible for hiring and paying for all your staff, rent, utilities, insurance, accountant, attorney, and all the myriad things that go into running a club. What % or amount would you charge in order to cover your bills so that it's still fair to the dancers, yet make an okay return on your money Keep in mind if the club is empty, you've still got to pay your girls!

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    God/dess shasta's Avatar
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    Default Re: Zero Tip Out and No Fines

    ^^ Are you paying for the strippers health insurance or were you just talking about the club's insurance policy?

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    Default Re: Zero Tip Out and No Fines

    Is there paid vacation? Free gym membership? Childcare? 50% is so much to pay out, I would want LOTS of benefits! I would still want lots of benefits with a 40% payout.

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