First subpoena issued after suspected wage theft by strip clubs

First subpoena issued after suspected wage theft by strip clubs

Published on September 17, 2024

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DENVER - Denver Labor has successfully issued its first subpoena in pursuit of lawful wages for dancers at PT's Showclub, Diamond Cabaret, and PT's Centerfold.

The hearing officer ordered that the clubs have until Sept. 24 to fully respond, after which, they will face fines of up to $1,000 per day. The case remains ongoing.

In April, the Denver City Council voted unanimously to give Denver Labor subpoena power as a tool in its wage investigations to collect the information it needs to protect workers.

Since then, our analysts have been working on this case to determine whether dancers were misclassified and whether their basic wage rights were violated. The clubs failed to produce specific records for the entertainers related to contracts, contact information, and dancers' payment before the subpoena was issued this month.

"It's a win for Denver's workers that we had this process in place in time," Auditor O'Brien said. "This is the first time we are using this subpoena power and without it we would be unable to conduct our investigation into whether dancers' rights are being violated."

An administrative subpoena is a formal written order from a government agency requiring someone to produce specific records or evidence. This information could be useful in a wage theft investigation to prove underpayments or other violations of Denver's wage laws.

By having a collaborative tool like this, the Auditor's Office can seek faster resolution and payment on behalf of workers, while limiting the burden for businesses.

In fact, the independent hearing officer specifically found the subpoena would not be an undue burden to the employers in this case. And they noted that Denver Labor offered adequate guarantees of the confidentiality of personal information.

Denver Labor has not reached any final conclusions in these cases, but is investigating whether these strip clubs misclassify their dancers as non-employees to avoid paying them minimum wage, overtime, paid sick leave, and all of their earned tips. Specifically, we asked for:

• Copies of all contracts between the clubs and their dancers going back three years from when we opened our investigation.
• Contact information for dancers for the same period.
• Records of all payments made to and from dancers.

While we will not release details of the case or any possible determination until it is closed, we encourage all employers to avoid misclassifying employees, and to pay all wages according to the law - including minimum wage, overtime, paid sick and safe leave, and all tips workers earn.

"Through this new legislation passed by City Council and my team's hard work, we're making it clear that we're watching for law breakers who are stealing from workers and undercutting fair business," Auditor O'Brien said. "We're prioritizing accountability and working to stop wage theft from happening throughout the city."

If you have information you believe is relevant to these investigations, please contact Denver Labor by e-mailing [email protected].

AUDITOR TIMOTHY O'BRIEN, CPA
Denver Auditor

Denver Auditor´s Office

201 W. Colfax Ave. #705 Denver, CO 80202
Email: [email protected]
Call: 720-913-5000
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