What to Expect with a Deferred Payment Agreement for a Film Crew
The deferral of payments is a common process in independent filmmaking. In fact, independent films are largely known for being cash poor. And for having to take extenuating circumstances in order to achieve successful production. Sometimes this includes preparing deferred payment agreements for a film crew. And other times it will involve specialty financing or non-traditional sources of financing. All in order to push the film through production.
While deferred payment agreements for a film crew are an essential element to independent filmmaking, many film crews want to know what to expect.
Particularly, they want to know what will happen if the film that they’re involved in never makes its way to distribution or turns a profit?
What is a Deferred Payment Agreement for a Film Crew?
The deferred payment agreement represents an agreement entered between the film producer and the film crew. Which basically encourages the film crew to engage in production or otherwise provide their services.
In exchange for an agreement that in the future if the film is distributed the film crew will be compensated for their time and skill investment.
Under a deferred payment arrangement, the film crew allows all or part of their pay to be deferred. In exchange for their investment into the project.
Pay under a deferred payment agreement is negotiated in such a way. That rather than asking the crew to take a lower pay rate for their work. The film crew accepts a deferral deal. Such that all or part of their payment for the project is deferred until a later date.
What’s Included in a Deferred Payment Agreement?
A deferred payment agreement will include pertinent details about the film crew member that is accepting the deferral, the film and the film production company, and some other important elements.
Including how much the crew member will be compensated for their work and the terms of the deferral such as whether or not the deferred payment will be made upon distribution of the film.
Or, if some other arrangement for profit will be made in which the deferred payment can be made for the production.
For Example
The deferred payment agreement for a film crew may even state. That if a film is not distributed, the crew will be paid from profits that come out of another film’s distribution.
These types of deferrals are less likely to occur they may come up. This is in the event that a filmmaker has other film projects in the works. And they really just need to enter into a deferral agreement in order to get the job done.
Why Would a Film Crew Member Consider a Deferred Payment Agreement?
You’re probably wondering why? Why would any film crew consider a deferred payment agreement? Why would any wait for months, years, or potentially risk never being paid for the work that they put into a project?
But, film crews accept deferred payment agreements for a variety of reasons including:
- A firm underlying desire to see the film become a success. (this might occur if the film is being created by a family member or friend)
- To expand their skill set and engage in a project that they would like to see in their portfolio.
- Because other incentives are linked to the deal such as higher payments or additional profit sharing.
In Summary
Entering into a deferred payment agreement for a film crew is something that only the crew can consider and decide upon.
But many producers have great luck in finding and securing film crews. Ones who are willing to work on a film project with a deferred compensation agreement.
Just be sure that you are aware of what’s included, how it works, and what to expect!
