Legality of under paid/free labor?

Z

ZeroContent

Member
I know that this has been a bit of a point of contention for quite awhile and I know it's hurting a lot of people who doing film isn't just a passion or hobby it's how we make our living. Yes, I LOVE doing film but love doesn't pay the bills. So I have a few questions to pose to this forum.

1. If anyone happens to know what are the legalities behind pay being either under even minimum wage or none at all please share. As far as how I read the minimum wage act, I don't see how paying less then $7.25/hr (as of Friday) plus OT is legal when working on a film.

2. Is there a way to combat the pillaging our services? Education, as massive collective, or is everyone just too greedy and say %@#% the greater good and just continue cutting each other's throats.

3. How do we massively inform those just starting out that working you should always get paid. Even the little old PA who is fetching coffee, you wouldn't work at starbucks for free get people coffee, why would you on a film set. If I see one more post "Sound mixer with equipment wanted for indie feature, $50/day" I'm going to snap, why would i work for 4.16 an hour assuming a 12 hour day AND bring my $14,000 sound package as well? I wouldn't bring a $20 dollar sound package to a gig for that, i might as well work at starbucks, at least they offer health benefits.

I'm personally just getting frustrated with the "Make Your Own Damn Movie!" and "Rebel Without a Crew" mentality. Yes a few people have made it by making slave labor films, but thousands and thousands have blown their life savings and/or credit thinking it was easy and end up failing. Mostly I figure this discussion would center around the Narrative, Doc and Reality world but I know there are a lot of people are here that make their living with Corp and Commercial gigs, I don't know much about those so I can't say much on those fronts.

There are also a few sketchy practices going on that I would like to address as well.

First would be filming with permits. Depending where you are this may or may not be a problem. If you want to shoot on the side walk of Wall St in NYC, get a stupid permit, last I checked (could have changed) if you don't need to shut down a street and you only need to lock a little piece of the side walk for a take in NYC it's FREE to get a permit, why get arrested or fined and have to deal with cops for something you can get for free. I know other cities are different and most major cities are free or pretty cheap, maybe a hundred bucks or two. Why put your entire crew into legal la la land, it's disrespectful and dangerous. (I have been on a shoot in the middle of nowhere in Maine, on a back country road, maybe 1 car every 5 minutes. We had a PA stopping traffic if a car rolled up during a take. We had 3 kids riding bikes in the middle of the road so we obviously needed to keep them protected as well. One guy refused to stop and almost ran a kid over. 10 minutes later a cop comes tells us a guy called them saying that there were people trying to block the road, blah blah blah, producer tells the cop that yeah, and he almost hit a kid, pulls out the permit, cop replies, alright, well if you have any problems like that again take down their plate and give me a call and gave us his card. Moral of the story, get a stupid permit because even in the middle of no where problems come up, free is cheaper then a fine, or bail.)

Second is shooting without production insurance, being someone who is bring equipment to the party you better have insurance to cover my gear if someone breaks my stuff. For the cost of a lectrosonics wireless receiver (that your talent decided to jump into the pool with it still on) you can have full production insurance that covers your equipment, crew and damage you cause to outside parties and properties. If you're not bring gear to cover your ass make sure they have worker comp insurance, if you bring gear make sure they have workers comp and equipment insurance, if you're letting them shoot on your properties make sure they have liability insurance. Don't get screwed and if you're a producer, don't get stuck with the bill when when of your lights starts a fire and burns down that nice house you were allowed to shoot in. Just food for thought.

Lastly is about the main topic of this thread which is pay. When you sign a deal memo (contract) make sure there are a few things in there that cover your rear since it probably just covers that production's rear. OT being a big one, whatever you negotiage for the hours of a "day" either 10 or 12 being the standard make sure you have an hourly rate set for anything after that time frame. If the producer says they have everything planned that they're not going to go over that time frame then say "Ok so what's the problem? If you're not going to go into OT then you don't pay me for it." because you know they're going to go over. Also make sure that you're covered with an exceptible turn around time (meaning the time of wrap to the next call time). Standard is 10 hour turn around. For me, since i've been screwed in the past, I word it that for every hour under 10 hours it is 1 hour OT pay, under 8 all hours under 10 are double time, under 6 hours is triple time. Also extended breaks keep the clock ticking. (From personal experience Call was 6am, we shot until noon then were down until 6pm and shot until mid-night. Read as an 18 hour day in my book. don't get boned like this, if the producer can't effectively schedule that's his problem). As for lower rates, if you feel the need to take a gig below your normal (or what would be concidered market normal) rate make sure that you add in a deferred amount to bring it up to your normal rate (I say even higher since you want a return just in case) and make sure that you are paid back at the same time as investors, your time is an investment in the film and is just as valuable as investor's money. Most likely you're never going to see a dime but on the off chance a buyer for the film is found, you'll get your nut because you are an outstanding debt.

Little longer then I wanted to go on, please ignor grammar and spelling mistakes if you see them. :-)

Eric
 
Eric,

I see and understand where you are coming from. However, forcing all films to pay people a "reasonable" rate would be the end of filmmakers who are true indies. I doubt there are many people here on this forum who can afford to pay the day rate of an AD by union minimums. Last check, I think it hovers around 800 a day for an ultralow budget. In fact, the day rate for that one crew member is more than the budget of nearly every film that hit our last fest here.

Indie filmmaking I think is done primarily on mutual help and excitement. Sure, there are sometimes when I get a call to work on something after being recommended, I don't get paid much - if anything, and I am miserable all day.

My close film friends, I will help out (for free) at the drop of a hat (pending availability). It's one of the only ways we can survive. Someone helps me, I'll help them.

As a profession, it doesn't work out. But for starting film makers, is there any other way to do it without potentially throwing away a great deal of money?

There are two sides to everything.
 
Typically there's nothing technically illegal about making a movie on a shoestring and it's a lot of peoples' dream. So what if they're not all going to make it big, let them take their shot because someone might. And for some, making it big is not even the point.

If you get all hung up about your deal memo, rate, max hours and all that crap you should be sticking with projects that have a decent budget and avoid lo/no movies like the plague because they're not for you anymore.

Noah
 
Well not necessarily union level but something in the realm of reality, I don't have a problem with $100/day for a 12/hr day for a PA. That works out to actually minimum wage for a 5 day week.
 
This is how business works. Most business types go through the same thing. The technology is there, the knowledge is out there and more people are interested in media production, either seriously or as a fad. And a lot of them will work for free, either with hopes of getting paid later on or as something they enjoy doing.

Why would someone pay union rates for something, when a friend is capable of the same job for free or much less? Why forgo their dreams of making that film if that's what it comes to? It certainly won't be to make your life easier, their job isn't to make sure you have one. That's what the lower end market is like right now, and one needs to adapt to it or leave it. The market doesn't adapt to what people want it to be, no matter how important someone might think themselves.

So, my response? Deal with it.

And it's perfectly legal to pay people who aren't employees whatever they ask for. You can pay them by job instead. Actually, even employees who aren't on wage. Volunteering is, obviously, acceptable.
 
Hmm

Hmm

Well I see the OPs points, though.

I'm kind of the same way, only as an employer, not a crew member. I believe in paying my crew at least a fair wage, if you come to my set with $14,000 of gear like that, even if it's a low budget indie production, I can't pay you less than $250-300 and be comfortable with that. If I'm asking you to work 12 hours, even without equipment, I should be paying $150 or more depending on skill level. I carry full production insurance, worker's comp, automotive, etc. All of that good stuff. And whenever I feel we need to, we get permits. I don't believe in getting permits to film on private property with a small crew because I don't believe it's any of the government's goddamn business what I'm doing on someone else's property when we have an agreement that does not concern them. I understand the People's Republic of California thinks they can enforce all of these communist ideals on their populace, but in point of fact it IS private property and what I choose to do on that property is none of their business. When it's a concern, i.e. playing loud music, street parking issues, etc., then yeah we get a permit, and it's about $685 at least, so it's not cheap. They make sure it's very expensive to film in L.A., they basically want to run you out of town unless you're a major studio, that seems to be the goal. The 9.75% sales tax, terrible business laws in this state, awful filming organizations, basically it's the worst possible place to do business, which is why so many production companies just leave.

The main problem with paying everyone fairly and doing things the right way is that often the clients are not willing to pay for that. Music videos don't pay anything anymore, so there are hardly any profit margins. Then you look at corporate work and too many companies think they can bid these pathetic little amounts that make it impossible for legitimate operations to exist. I think there is a massive degradation of quality at the bottom because people think that, "Well, everyone is used to YouTube crap, so we'll just pay some amateur to do our corporate video work, oh well, it's cheap." I was talking to another production company at a mixer here and the guy said that he had bid $35,000 for this rather difficult, travel-intensive project in the Bay Area, and he got underbid by someone else willing to do it for $2,800. I feel the same way as him -- I can't compete with that. I'm not going to make you a virtual tour for $400. A virtual tour, even if it's the most minimal thing in the world, is still going to be $1,000, and a really good one is going to be $5,000. That's the only way to do work like that professionally with full equipment, a small crew, insurance, proper Website integration, etc. But if all someone cares about is getting a really crappy little video from a consumer camcorder, well, yeah, some guy on Craigslist will do that for $200 or something like that. I have no interest in competing with those people, though. I'm interested in doing work for companies that will pay for quality and understand that legitimate companies have expenses. I cannot make a living charging tiny amounts like that. I have an employee who I have to pay a decent wage, she has office expenses as well, we have insurance, worker's comp for her as well outside my normal production insurance, constant equipment expenses (take $300 for Final Cut Studio's upgrade just a few days ago, for instance), etc. It costs A LOT of money to run a real production company, so if I don't make that money I can't afford to pay anyone a legitimate amount.

My attitude is not the same as some people here, though. Other people take this as a sign that you should basically be a jack-of-all-trades and do really low end work and try to compete with the amateurs. I don't think so. Honestly I would much rather just go work in another industry, because running a business requires certain principles of quality and if you're going to abandon those just to compete with amateurs, forget about it. It's just not worthwhile.
 
Yeah- if you're looking to make your living off being below the line crew on lo/no budget films that is the problem. That's a gig you take for the experience and the networking. But it's not going to pay the bills ever. You either do well and move up into the union gigs or you find another side-gig to support your fun (hopefully) hobby.

Noah
 
The bottom line is, if you want to do it for a living, you won't mind doing it for free first.
Don't look at is as exploitation. See it as education, it just costs much less than when you were in school.
 
Even if you don't pay in dollars, you must have an agreement that shows some type of "consideration" paid for the person's work. For you to legally own their work, there must be an exchange of some kind of value (it could be a dollar, it could be a credit, it could be almost anything - but you must state it and they must agree to it). That is where the phrase "for good and valuable consideration received" comes from. That also confimrs that they got the "consideration."
 
Thank you for your comments, ZeroContent. I feel the same way and I may leave this industry within the next two years if this is how things are going. Video/film has become a commodity and I make considerably more money with my still camera that cost thousands of dollars less than my video camera and all its accessories that come along with it.

"Where do we go from here?" is a question I keep asking myself. The low-balling companies fad started before the economy went to crap. And as far as the indie producer, I have seen more shady producers who own $30K+ worth of camera gear and a nice car/van who say thy can't pay their fellow crew members who lend their gear (at the very least) gas money. That's the type of garbage that boils my ass.

This industry, that was cutthroat when things were good, is even more so now than ever. And I wish everyone the best of luck.
 
Barry_Green said:
I had to report for jury duty today.

$12. For an 8-hour day.

Just sayin'.
Click to expand...

LOL, nice.

Don't they still call for jury duty based on whether you're registered to vote? I hope so because I just didn't bother to register in CA yet, I really don't think my one vote is worth having to get called for jury duty. I already escaped once from that when I was in Oregon, I got a postponement because of my mom's health, and it was going to be a LONG trial, like 6-8 weeks at least they thought, and there's no way I would have done that crap. Some people have lives. Then when I got called for jury duty a second time, I was already in California, so I sent back my reason for not serving -- no longer live in your county, no longer live in your city, no longer live in your state. Thank you. Bye. haha.
 
States labor laws require that any company employing more than 5 employees and/or grossing more than $500,000 per year to pay federal minimum wage, overtime, and provide workers comp. and unemployment insurance.

Some people do get by with working for FREE, but this is technically illegal by all stretches of the imagination. Don't rely on that "Intern" real either. Federal law states that in order for a company to use an unpaid intern, the company must not use the intern in a way that will benefit the corporation more than the intern, or in any position that would normally be filled by a paid employee.

To be safe, they should also be enrolled in high school or college, and be receiving some form of "credit" for their internship.

Also, most film crews and actors do not qualify as independent contractors, since you are directing them in their work, telling them when to show up and go home, and they generally don't own the equipment they use...
 
Nonetheless most are treated as independent contractors regardless, and nobody bats an eye. It's just the way it is, and the way it should be, really. It's unreasonable to act like someone who works for a day or two on a set is an "employee" -- they clearly are not. You may be telling them what to do for a day or two, but you don't even know half the time what they actually do, I mean I don't know how to do a sound guy's job, and he does bring his own equipment. He's a plumber, basically, or an electrician, an independent contractor, not an employee.
 
Careful... I have a friend in the Haunted House business who hired his actors as contractors, and then the government came down on him when a "contractor" actor tried to claim unemployment. The government said that since he was being directed in his actions, told when to show up and how to his work, that he did not qualify as a contractor.

My buddy got billed $25,000 in fines and made to repay the minimum wage, FICA, W/C and other taxes.

I'm not saying that its not done, only that it is not technically legal to do so.
 
JonathanLB said:
Nonetheless most are treated as independent contractors regardless, and nobody bats an eye. It's just the way it is, and the way it should be, really. It's unreasonable to act like someone who works for a day or two on a set is an "employee" -- they clearly are not. You may be telling them what to do for a day or two, but you don't even know half the time what they actually do, I mean I don't know how to do a sound guy's job, and he does bring his own equipment. He's a plumber, basically, or an electrician, an independent contractor, not an employee.
Click to expand...

Not necessarily ... much of the time talent and below the line crew such as sound mixers are paid through a production payroll service and they become a nominal employee of the payroll service for the duration of the production. In the case of a soundie who provides his own equipment, fees for the equipment rental are invoiced directly to the production while fees for his wages are reported as hours worked and paid through the payroll service, subject to the usual withholdings, etc.

"Employee" status is not dependent on the duration or consistency of the employment and in some jurisdictions there is even the official category of "casual part-time employee" to describes such short-term or on-demand types of employment.

One of the factors in the IRS guidelines is whether the person is operating as a business and as such is providing services to a variety of clients or is being hired as an individual worker. A soundy might be a business but a grip or actor probably is not. If the person is incorporated it makes it more likely that he'll be considered a contractor, if not, more likely to be considered an employee.

Using the "but that's not the way it should be" defense in an IRS audit won't get you very far. The law is not about what things ought to be ... it's about what the legislature and the courts have said that it is. If the law says that it's nightime when the sun is directly overhead, then that's what a court will enforce. "Employee" is defined by the IRS regulations ... if they say someone is an employee, then that's what they are, whether it makes intuitive sense to anyone else or not. Whether it's reasonable to say the mixer or grip is an employee or a contractor is moot, the only thing that matters is what the IRS rules.
 
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Based on current IRS descriptions (open the common law links from this page... http://www.irs.gov/businesses/small/article/0,,id=99921,00.html), actors look like they fit the description of contract workers. I'm not a lawyer, or an accountant or anything like that, so don't take this as legal advice, and don't take it as any other sort of advice. It's just my oppinion.


Behavioral Requirements:

a) When and Where - Actors are not told when and where to work. They sign contracts that outline the deliverables that are expected of them (typically in the form of recorded performances that involve a wide variety of collaberation). In order for the actor to provide those deliverables, the actor typically must show up at a certain time and location, on their own volition. If an actor chooses not to show up at the time and place, then very typically the hiring company will shift it's project schedule to accomodate the actor's decisions. Actors' schedules are dictated by the project schedule, not a regular work schedule.

b) Equipment - Choice of tools and equipment are not dictated to actors.

c) Subcontracting - Actors are not told who they can hire to assist them with their work. As long as the actor is paying for it, the actor can hire whomever they want. If contractually obligated, the actor might have to interface with specific 3rd party companies, in order to produce the expected deliverable. This is common for contractors in nearly any field.

d) Vendor Use - Actors are not told where to purchase their supplies or services.

e) "What work must be perfomed by an individual" - Actors are not given specifics about what work must be done by specific individuals. Actors can utilize any people they want for a task, so long as they produce the deliverable that they are contracted to provide. The deliverable, in most cases, is a scene containing the actor. If the actor knows of a way to produce that product without his involvement and without jeapordizing the project schedule, he's free to do so.

f) Degree of Instruction - Actors are given scripts and are told the director's vision, but it is up to the actor to determine the method and approach that they use towards the end product. Like any contract employee, if the hiring company is not satisfied with the end product, the hiring company can request that the contract employee provide a new deliverable that better fits the hiring company's expectations.

g) Evaluation - Actors are evaluated by the end result of their work, not the method used to arrive at the end result.

h) Training - Actors are not trained by the hiring company.


Financial

i) Significant Investment - The IRS admits that a significant investment is not necessary for independent contractor status, as some types of work simply do not require large expenditures. Acting is the type of field that does not require large expenditures, so the issue of significant investment is irrelevant. Though, if an actor does have money invested in his work, it is most likely that the cost was entirely paid for by the actor.

j) Unreimbursed Expenses - Like most contract workers, actor's expenses are frequently unreimbursed. Acting classes and marketing expenses are usually paid from an actor's own pocket.

k) Opportunity for profit or loss - Actor's frequently have to work extra jobs because they lose money while working as an actor. This is especially true when the actor is working on low-budget productions, for deferred pay or as a volunteer. This is indicative of contract work.

l) An independent contractor is generally free to seek out business opportunities. Independent contractors often advertise, maintain a visible business location, and are available to work in the relevant market. This is typical for actors. They operate their business from home, or it is handled through their agents. They make themselves available to work throughout the relevant market.

m) "An independent contractor is usually paid by a flat fee for the job. However, it is common in some professions, such as law, to pay independent contractors hourly." Actors are often paid by the job, or are given deferred payment, which is typical of contract workers. When actors are paid hourly, the intent is often to spread a per-project lump sum payment across the life of a project.


Relationship

n) Having a contract with a worker (which is how actors are normally hired), as opposed to hiring them for a job position, helps to indicate that they are a contract worker. The IRS has mentioned though, that they do not necessarily care whether a contract was signed or not, and that they prefer to look at other types of criteria to determine worker classifications.

o) Employee benefits (insurance, pension plans, paid vacation, sick days, and disability insurance) are not usually granted to independent contractors (nor to most actors doing independent projects). However, the lack of these types of benefits (per the IRS) does not necessarily mean the worker is an independent contractor.

p) "If you hire a worker with the expectation that the relationship will continue indefinitely, rather than for a specific project or period, this is generally considered evidence that the intent was to create an employer-employee relationship." Actors are not hired with the expectation that the relationship will continue indefinitely. They are hired per project, rarely lasting more than a a couple months. Even episodic series actors are rarely expected to remain on a project for more than a couple years.

q) "If a worker provides services that are a key aspect of the business, it is more likely that the business will have the right to direct and control his or her activities. For example, if a law firm hires an attorney, it is likely that it will present the attorney’s work as its own and would have the right to control or direct that work. This would indicate an employer-employee relationship." Actors primary service is to create solo performances in a live environment. The hiring company, on the other hand, has a primary service of producing pre-recorded multimedia presentations. The actor's service is not similar enough to supplant the key aspect of the hiring company. Also, actors are usually given credit for their contribution to a project, which is yet another sign that the actor is a contract worker.
 
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