Strip Clubs and the Law (and a Lawyer!)

“Should business execs meet at strip clubs?” asks a headline in today’s USA Today (click here). Female employees have increasingly questioned whether it’s fair — or legal — for their male managers and colleagues to exclude them when they fraternize at strip clubs.

Recently, investment firms have cracked down on the practice, and the NASD and the NYSE have both proposed rules that would force firms to adopt business entertainment policies that specify appropriate venues.

Says Hydie Sumner, a financial consultant who won a $2.2 million gender discrimination judgment from Merrill Lynch in 2004: “When ‘business activities’ involve the strip club, golf course or hunting ranches … discrimination is often perpetuated as those in power support and advance those with like minds and tastes.”

What galvanized reform efforts, according to the story, was a 2003 Fidelity Investments trader’s bachelor party, paid for by brokerage firms including Jefferies & Co., that included paid female escorts (not to mention dwarf-tossing). And last fall, Morgan Stanley fired three salesmen and a researcher who took clients to a strip club on an Arizona business trip.

Details here from The Wall Street Journal's Law Blog.