Can you pay actors in shares?

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paulbrighton

OK, so if you don't have a big budget what's the legality of paying people in shares of future profits? i.e. each actor gets an equal share of 50% of any profits of the film. Presumably it's fine to pay yourself below minimum wage so if each actor is essentially a partner then does that apply too? In which case as a partner presumably the actors can refuse to do what the director says because they are not employees. But if the deal was that they get a profit share in return of acting work done then is this illegal since the value of the company at the start of the film is essentially zero which means your breaking minimum wage laws.:huh:

Which means that you could make the actors partners and then cross your fingers and hope they do what the director says? Even though they could refuse to do any acting and just hope that others will take there place and make the film successful so they get a profit share???
 
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Minimum wage only applies to businesses with employees. Legally, the actor is not your employee, and they can agree to act in your film for any agreed-upon amount, or none at all. If volunteering were illegal there would be no indie filmmaking.

Anyway, the scenario you're proposing is what's referred to as "deferred pay". The impression i get is that seasoned actors and crew tend to treat deferred pay the same as volunteering, because the odds are slim that the movie will turn a profit.
 
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Typically low/no budget projects will offer talent (specifically SAG talent) a "deferred payment" agreement. Which acts as a promissory note that if/when the movie turns a profit, they will be paid.

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EDIT

After posting saw someone before me already mentioned it. Ah well, here's an example form I was able to find on the web you may be able to model yours potentially after.

http://andromeda.rutgers.edu/~aristim/VIDEO/toolkit/deferred.html
 
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I just want to mention that, at least for crew, deferred pay is just another way of saying that you will never get anything.

I know that a lot of folks are very sincere, but the odds are extremely long that I will ever get any money out of the project.

Please don't take this personally...

I get folks all the time who want me to donate hundreds of hours of my life for their project without any compensation or deferred pay. The films the passion of their entire life, they've put everything that they have into it, blah, blah, blah. You have to understand that it's not my passion; I'm running a business, and I have bills to pay. Just building my room cost tens of thousands even before I put the equipment in. Add in my years of experience. And you want all of that for free. I'm sorry, but I'll need more of an inducement.

This is not to say that I don't take on the occasional free-bee. If there are exceptionally strong production values, in addition to a great script, excellent acting and terrific production sound, and/or if there is something that I can learn or a sonic challenge of some sort, I will take it on. But it must be done around my schedule, because paying work and my family will take precedence. And it's always a short; a feature is just too much of an investment, and I don't think that you want to wait two or more years for your sound design.

Just some observations from my little corner of the universe.
 
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You are wasting your time offering cast and crew points and I think that, if you are doing it sincerely, it might have a negative effect, as it kind of suggests naivety or inexperience.

In the UK, you can just agree with actors to cover their expenses, offer showreel material, give them lunch and coffee...etc. There are hundreds who would be willing to work for that deal.

Crew is always trickier but poke around and you'll find people who are willing to volunteer.
 
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So if it was just a bunch of guys and gals who agree to work together and share any profits (if any!!) what would be a good profit share for each actor. 5% 10% 20%?

Say there were about 2 lead characters
3-4 main characters
and 6-7 extras

Also would some actors be satisfied with some sandwiches and a few beers?

Mostly this film is for fun but maybe at a later date we might want to sell it.

In which case if it becomes commercial then would you have to back-pay the actors at least minimum wages?
 
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for my up coming feature, i'm doing it this way.

as we are a no budget movie, noone get's paid.

i plan to shoot at most, up to 10 days total.

each person, helping out for a full day, get's .1 percent share.
So if they help out the entire movie, they get entitled to 1% of the profits from the movie should it ever make a protif.

Also, i'm putting in a loft and end date. Whichever reaches first. That is to avoid me having to pay them each year for the next 50+ years, in case the movie makes a profit.

but i'm also telling people, do not expect to ever make money on this one. But it's like an extreme lottery ticket.. you might get lucky...
 
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I just want to mention that, at least for crew, deferred pay is just another way of saying that you will never get anything.
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Yep. Pretty much. Hahaha
No offence intended towards anyone either, it's just the truth of the matter. I'd much rather someone come to me with a great idea and ask me if I want to take part than say "You'll make some money if...". It becomes more a "friendly" kind of process that way and less mechanical.
 
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Legally, the actor is not your employee,

Cracker Funk said:
Minimum wage only applies to businesses with employees. Legally, the actor is not your employee, and they can agree to act in your film for any agreed-upon amount, or none at all. If volunteering were illegal there would be no indie filmmaking.

How do you combine that with the fact that you need worker compensation insurance for your cast?

Can you send me a law text stating that actors are not my employee?

Thank you! :yes:

Koikaka
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Koikaka said:
Can you send me a law text stating that actors are not my employee?
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An actor who make a one or two day appearance on a movie can be
an independent contractor. However, an actor (and crew) hired for
an entire production is different. You will not find any law stating
that actors are NOT employees - that law doesn't exist. What CF is
talking about are volunteers - people helping you personally. From
your other posts this isn't what you are doing.

From the IRS:
You are not an independent contractor if you perform services that can be controlled by an employer (what will be done and how it will be done). This applies even if you are given freedom of action. What matters is that the employer has the legal right to control the details of how the services are performed.
If an employer-employee relationship exists (regardless of what the relationship is called), you are not an independent contractor
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When I am hired to direct a "showcase" I work for a few days and am
an independent contractor. When I am hired to direct a feature I am
an employee. I have been hired as an independent contractor to direct
music videos - again, only a day or so of work.
 
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