The strippers and support staff at San Francisco's Lusty Lady peep show theater had done it again.

After months of hard-nosed negotiations -- including three days of eye-catching informational pickets and full preparation for a strike -- the workers at the only unionized sex club in the nation got just about everything they wanted from the theater's owners -- restoration of an earlier $3-an-hour pay cut, a cap on the number of dancers working at the theater, an end to videotaping dancers while they worked, and no back-tracking on sick days and health insurance.

It was a hard fight, and the dancers were heady with victory. For the sixth time since they joined Service Employees International Union Local 790 in 1997, the dancers had held their own in a contentious labor dispute and proved to the theater's owners, to themselves, and to the world at large that women who dance naked for a living could stand together, fight for what they wanted, and win. Coming down to the wire about calling a strike (contract agreement was reached three days before the strike deadline) had forced everyone to pull together, get organized, get clear about their priorities, and get efficient. If they had doubts before, the dancers and support staff at the Lusty knew now that, when the chips were down, they could meet, make decisions, and pull together to do what needed to be done.

If you think that women who strip naked for the sexual pleasure of others -- who display their bodies only inches and a thin sheet of plexiglas away from hundreds of masturbating men each day -- must be pitiful souls devoid of pride or self-esteem, think again. The 60 dancers and 15 support staff at the Lusty Lady Theater are a strong, energetic, and creative crew. And they've discovered that, with a union to back them up, they don't have to accept wages and working conditions dictated by the people they work for. They may not get everything they want, but they usually get pretty close. Most significantly, they know that they can be active players in the workplace, rather than powerless pawns being moved around the chessboard by people and interests far more powerful than themselves.

In this case, however, despite their contract victory, it soon became apparent that all was not well in paradise for the Lusty dancers. Less than two months after the new contract was signed, dancers and staff at the Lusty were notified by the owners that the theater was going to close up shop in three months. Darrell Davis, the company's general manager, tired of flying from Seattle to San Francisco to deal with labor issues, had resigned and, perhaps as a result, the owners had decided to dump their San Francisco franchise and relax into the more placid business of managing their Seattle theater, where non-union dancers accepted management's rules without serious question and kept any grievances they might have to themselves.

The owners had warned during contract negotiations that, if they gave the dancers what they wanted, the theater would no longer be profitable. But the owners had said the same thing each year during contract talks, and the dancers didn't believe them, especially when the owners refused to let negotiators examine the company books. But this time the owners weren't bluffing and everyone's worst-case scenario had become a reality. The owners wanted out, there were no buyers who wanted to take on the "liability" of dealing with a union, and everyone was about to be out of a job.

During negotiations, Donna Delinqua (her stage name) -- a graduate student in English Literature who's completing her dissertation on the depiction of sex between women in pornography -- had not entirely dismissed the owners' claim of impending financial insolvency. But Delinqua wasn't intimidated by the possibility of a shut down. "If they close the theater," she thought, "we can just take it over."

It wasn't the first time the idea of dancers running the theater had crossed someone's mind. Three years earlier, a group of dancers considered buying the theater if the owners made good on their threat to close the place down. Now it was time to see if the idea of a dancer-run strip club was just a pipe dream, or if the idea could be transformed into workable reality.

Delinqua called a general meeting of dancers and staff. Rainbow Grocery, a well-established local cooperative, and Good Vibrations, the nationally-known, women-friendly, worker-owned sex toy store, sent people to explain the nuts and bolts of structuring and operating a worker-run business. The idea of actually owning the place where they worked was exciting and infectious, and the we-can-do-anything feeling from the triumphant contract negotiation was still very much in the air. The group decided to put together a plan to buy and operate the Lusty Lady themselves.

"If we hadn't just come through the negotiations," says Ruby, who has danced at the Lusty Lady for a year and a half, "I don't know if we could have made this happen. But we had become a strong group, we had gotten used to working together, and we just believed that it was possible to buy the business and make it work."

Plans were developed, organizational and operational structures hammered out, committees formed. Pepper was in charge of negotiating the purchase with the owners. Tony would come up with a financial overview. Miss Muffy would coordinate signing people up as owners. Ruby would deal with the city, the police, and the fire department about licensing. Havana would take charge of getting the new business incorporated. Rapture and Cayenne would write the new corporation's by-laws.

In less than three months, everything had come together and on June 1 the Lusty Lady became the nation's first worker-owned strip club. General manager Davis, who had stirred intense anger among dancers during contract negotiations, became noticeably cooperative when it came to negotiating a buyout. It didn't hurt that the dancers' was the only offer on the table. A selling price -- confidential, but substantial -- was agreed to and, if all goes well, will be paid off over the next five years. There was no down payment.

Anyone who works at the theater can become an owner for $300, regardless of how many hours they work. "We wanted to make the amount people paid to become owners large enough that it be a real commitment," Delinqua explains, but not so much that it was out of reach." To make becoming an owner accessible to as many people as possible, the $300 can be paid over time. At the end of each fiscal year, any profits above money reserved for working capital is to be distributed to owners, based on how many hours they've worked. Of 60 dancers, 45 have already become owners, with more expected to sign up over time.

The company's Board of Directors is made up of five dancers and two support staff. After years of feeling pushed around, the dominating ethos is a commitment to fairness, cooperation, and equality. Decisions are made by majority vote, "but we use a consensus-building process to try to make sure that everyone's concerns are dealt with," Delinqua explains. The Lusty's ground-breaking union, however, has not been disbanded. "There's no guarantee that, down the road, people will be as committed to fairness as we are," Board-member Pepper notes. "Also," she adds, "we want to continue our outreach to other strip clubs about the possibilities of unionization."

As it turned out, many of the dancers had skills that proved useful in pulling the new cooperative together. Some had worked as paralegals. Others had managerial experience. Mostly, though, it was a matter of rolling up your sleeves and discovering that you could do things you'd never done before.

"It's been a huge learning curve," says Ruby. "Before this I didn't know anything about running a business. We're all learning about accounting procedures, about insurance -- things I never thought I'd be doing when I signed on as a stripper."

The difference between working for someone else and working for yourself is like the difference between night and day, especially in a service business that rises or falls on the personal appeal of its workers. Two months into their experiment, the dancers at the Lusty seem almost universally excited about their new possibilities.

"We're about to see a new Golden Era at the Lusty Lady," Pepper predicts. "The importance of worker incentive should not be underestimated. Now that we're working for ourselves, everyone feels fresh and friendly, and that affects how we relate to each other and how we relate to the customers. Now everyone has new reasons to be present with customers, to give good shows. The quality of everyone's performance is going up. The theater is cleaner than ever, and we're considering a number of capital improvements, like new carpeting."

"All the stuff that used to be secret and shrouded in mystery," says Ruby, "now it's posted every week, open for everyone to see. How much money we brought in, each check that was written, how the Private Pleasures booth did."

"People seem to be getting into being more glamorous, getting more elaborate with their costumes, paying more attention to their appearance than they were before," Delinqua notices. "Now everyone has to consider the financial consequences of what they do, how they act, how they look."

Delinqua points to the new system of dancer evaluation as one concrete example of how things have changed with worker ownership. "Before," she says, "dancers were evaluated by managers who were not dancers themselves. Now, it's all peer evaluation. Each week a new group of five dancers evaluate the other people on their shifts -- their general appearance, being pleasant with the customers, making eye contact, paying attention to the customers, making them feel welcome. There are no managers, only team leaders -- we call them Madams of the House -- elected for six-month terms. Everyone dances."

Ruby likens the new spirit at the Lusty to the pioneering example of Good Vibrations. "Good Vibrations totally changed the world of sex toy shops," she notes. "Before Good Vibes, sex shops were seedy places. Women didn't go there. Good Vibes changed all that. It's clean, it's not creepy, so going there is no big deal.

"We're trying to do the same thing. We want to show that it's ok to view adult entertainment, that it doesn't have to be something you're ashamed of, something you do in secret. We hope to include women customers more, and to make everyone feel more comfortable coming to the theater."

The sense of new beginning is tangible everywhere around the Lusty. People are realizing that, now that they own their own business, they can do what they want with it, a new ideas are cropping up everywhere. The first major innovation was the establishment of Women's Night, which will be the last Wednesday of every month. The first Women's Night in July was a huge success -- grossing 20% more than usual for a Wednesday. (Men were allowed, if accompanied by women, but they had to pay $10 at the door, and stay with the women who brought them.)

"We set aside half the booths for women only," Delinqua explains. "We made sure that everything was very clean. We had dancers meeting women at the door, acting as their Lusty Lady Tour Guides, helping ease their transition. About a hundred women came. The dancers were so excited to be bringing women in. Good Vibrations and S.I.R. Productions sent gifts of lube, porn, and condoms. The evening was co-sponsored by the Sex Worker Film and Video Festival. Everyone had a great time."

Another new idea being considered is having a couples night, where a woman could come with her husband, boyfriend, or girlfriend, go backstage, get glammed up with the help of regular Lusty dancers, and then dance on stage for her partner -- a chance for women to act out the fantasy of being stripper for a night. A perfect birthday gift for a partner, or for yourself.

"We want to be innovative," Delinqua says. "We want to try new things and see what works. There's the sense that we don't have to be bound by how things have been done before."

So far the new system seems to be working well. Delinqua estimates that about a third of the new owners are actively involved in running the business. Some potentially difficult issues -- discipline, hiring new people, long-range financial decisions -- have yet to come up, but Delinqua feels confident that these issues can be dealt with constructively, in the spirit of cooperatively working together.

"Most people feel vested," says Ruby, "and that makes all the difference. It's our show now. It's a really exciting time for all of us. We're all here doing it together and we're really proud of what we're doing. We're trying to make the Lusty Lady a safe and fun place for everyone -- dancers and customers alike. And we hope that we can inspire other sex workers to know that you really can do it yourself, especially if you have a strong group of people committed to working together."