On March 5, the New York Times reported that Brazilian Blowout, makers of a popular hair straightening service, had agreed to settle a class-action lawsuit for about $4.5 million. Earlier this year, the North Hollywood, California-based company agreed to pay $600,000 in fees and penalties in a settlement with the California Attorney General.

Both suits were brought about because independent lab tests have shown that Brazilian Blowout emits formaldehyde gas, a known carcinogen, when heated during application. In 2010, regulators in Canada and Oregon issued warnings after stylists and consumers reported that exposure to the styling treatment was also causing nosebleeds, respiratory difficulties, and eye irritation, among other problems. The federal government’s Food & Drug Administration sent its own warning letter in August 2011.

But even though public health officials have issued such warnings, though salon workers and consumers have reported health consequences, and the courts have demanded more than $5 million in fines, Brazilian Blowout remains in salons and on the head of many a beauty consumer, because no government agency, including the FDA, has the authority to issue a recall.

And that means the manufacturer can continue to sell the product exactly as-is — even though formaldehyde was recently added to the National Toxicology Program’s list of substances known to cause cancer — and salons can continue to offer the treatment and require hair stylists to perform it and/or work in the same room while others are using the product.

“I’m now hearing from hair stylists who have had their jobs threatened and are being bullied by co-workers and management if they complain about exposure to Brazilian Blowout,” says Jennifer Arce, a San Diego, California-based hair stylist who first developed breathing problems after using Brazilian Blowout in 2010 and contributed evidence to the state’s case against the manufacturer. Arce had to quit her job when her boss refused to stop offering Brazilian Blowout or similar keratin-based hair straightening treatments even though several of the stylists on staff were reporting adverse reactions. “We were all getting rashes, headaches, and bloody noses,” she says, noting that most of her colleagues in the beauty industry do not have health insurance unless they’re lucky enough to receive coverage through a spouse’s employer. “I’ve never had breathing problems before in my life and now I’m on two inhalers and spending a fortune on medications. It’s at the point where I’m seriously considering giving up my career all together. It’s a total nightmare.”

But Brazilian Blowout’s chief executive Michael Brady views the latest settlement as a victory. “We get to sell the product forever without reformulation; in my eyes, that’s the acquittal we’ve been waiting for,” he told the New York Times. And despite all the evidence to the contrary, the company continues to insist that its product is safe: “We just want people to treat it like they do aspirin — make sure you only use it as directed,” Brady has said.

Of course there are two clear problems with that logic: For starters, as a drug, aspirin is required to undergo much more stringent pre-market safety testing before it hits store shelves than Brazilian Blowout and other cosmetics. And if you really want to compare Brazilian Blowout to a drug, nicotine, with its secondhand smoke issues, would be a more apt choice. “If you take too many aspirin, you’re the only person who gets sick,” Arce says. “But if one customer wants to receive a Brazilian Blowout, it’s not just her health on the line. It’s the health of her stylist and every other stylist and customer in the salon.”

It’s also interesting to note that even while Brady insists his company’s product is safe when used as directed, the brand nevertheless launched a companion product called Brazilian Blowout ZERO, which claims to be made with “a proprietary blend of ingredients” (instead of the methylene glycol used in the original formula) and promises “0% formaldehyde released before, during or after treatment.” The company even links to its own accredited test resultsto back up that claim. But it defends its decision to continue selling the original formula alongside the new one: “We remain 100% confident with regards to the safety and integrity of the original BB treatment and will continue to sell this product as it remains incredibly popular […] A number of stylists and consumers may feel more comfortable using this [new] system as a personal preference.”

As long as they’re given the choice: While customers can walk out and take their business elsewhere, stylists may have little recourse if their salon owner chooses the original Brazilian Blowout formula or another keratin straightening system that triggers adverse health reactions. As I reported in 2007 for the Nation, many hair stylists and other salon workers are considered self-employed and thus aren’t protected by traditional workers’ rights laws. Arce says when she first called California’s Division of Occupational Safety and Health (Cal/OSHA) to report her symptoms, she was told that she was one of “dozens” of stylists who had called — but because they were all “booth renters,” Cal/OSHA’s hands were tied. “The guy I spoke with told me he was literally sitting by the phone waiting for an employee to file a complaint,” she notes. And while he waited, more hair stylists were getting sick.

Arce has joined forces with the Campaign for Safe Cosmetics to continue the fight to get Brazilian Blowout off salon shelves and the National Healthy Nail and Beauty Salon Alliancehas launched a letter writing campaign to encourage stylists experiencing Brazilian Blowout-related health problems to report them to the FDA. But until we have fewer gaps in our cosmetics industry regulations, workers will continue to pay a high price for pretty.