What Does Pay or Play Mean in a Contract

Always seek advice from a qualified entertainment lawyer before committing to any type of salary or gambling clause. A payment or broadcast clause in a film and television contract simply means that a person engaged to provide various services for a film or television production is granted a guarantee of payment, whether or not he works. The emergence of a payment or broadcasting clause is due to the unpredictable and volatile nature of film and television productions. “Each transaction is unique, and specific considerations regarding the manufacturer`s agreement may or may not be addressed in a `sample` or `model` that a manufacturer may or may not receive. I am a litigator and I have had several situations where my clients have had to go to court for contracts based on a “sample” or “model” contract that did not fit well with the specific business agreement. Finding the support of a front-line lawyer will cost more than using a free template. But if things go wrong, it could save a lot of money (and stress) in the long run. So how do you design salary or gambling clauses for yourself? Unless you are negotiating juice box payments for the small league team you are coaching, it is highly recommended that you do not. Individuals and businesses use the legal guarantee provided by payment or gambling clauses to minimize financial risks associated with uncertain future conditions. Payment or gambling agreements are usually required by high-level talent as a condition of any agreement to provide their services. Indeed, by agreeing to provide their services, they agree to invest time in their profitable schedule for an agreed period of time.

This commitment of the actor or director forces him to reject alternative opportunities that may collide with this agreed period of time, however lucrative or promising they may be. Simply put, a payment or gambling agreement provides for the payment of their commitment. The most common examples of exceptions are those called force majeure – a term that refers to events that prevent the performance of a contract but are beyond the control of one of the parties. An example of this could be a natural disaster or a sudden change in the law). A payment or game clause is a point of a contract that guarantees that one party will pay the other, even if it is exempt from the contract and its services are not used. Seriously, this fact cannot be overstated. The reality of any purpose of the contract is that it must be adapted to the particular situation, and only a qualified lawyer will be able to perform this task safely within the framework of the law and a reasonable error rate. When it comes to drafting pay-or-play clauses (or any other object of the contract), there is only one piece of advice: in a later section we will discuss why it is so important for a lawyer to draft these contracts so that you have no problems later. You can compare some of these examples to the content of this article to get a better idea of our definition of compensation or gambling from scratch: what the clause is, what it is not, and what it can be. This way, when it`s inevitably time for you to find a lawyer or create your own, you`ll feel more comfortable. The standard payment clause describes what happens if one of the parties to the pay-or-play contract violates the agreement. It describes an action plan to be taken in this case and usually provides guidance on the payments that may be requested.

Payment or gambling clauses in film and television contracts are most often used to encourage great creative talent, especially actors and directors, to stick to their schedule for a particular project well in advance. If the project subsequently fails for any reason or if the talent`s services are no longer needed, the talent will still be compensated for the opportunity cost of their scheduled time at a contractually agreed rate. To find out more about cancellation fees, you can consult the definitions of guaranteed contracts and the collective bargaining guidelines established by the relevant film unions. Getting acquainted with the DGA and SAG plans is a good place to start. However, other exceptions may be included in the contract if they deem it necessary. In this way, you could view exceptions as a kind of antithesis to conditions precedent. One of the most common, though often misunderstood, terms used by agents and lawyers when doing business is pay or gamble. Essentially, paying or acting is the obligation of a producer – a studio, a network, a production company or an individual – to pay the artist, even if the producer later decides that the artist`s services are not needed. In other words, whether or not the production continues and whether or not the artist is obliged to provide services, he will receive the negotiated royalty.

This is subject to limited exceptions, usually including the artist`s disability, force majeure (an unexpected or uncontrollable event, also known as “force majeure”) and/or the artist`s breach of the Agreement. The expression is somewhat confusing because it implies that the artist is either “paid” or “played”. Of course, when the artist is played, he must also be paid. According to Winger, she had trained for three months with the Chicago Cubs to play pitcher Dottie Hinson. However, when Madonna landed the role of Mae Mordabito, Winger left the film after accusing director Penny Marshall of “making an Elvis movie.” The concept of guarantee is at the heart of the pay-or-play clause and makes the object of the contract both valuable and risky. Granted, contract salaries in the NFL are usually large, but the difference between the total amounts contracted and the amounts actually guaranteed by a contract can often be measured by order of magnitude (i.e. still a lot of money, but much less money, as in Kaepernick`s case). Payment or gambling clauses have undoubtedly become a mainstay of the film and television industry. It is therefore of the utmost importance to understand them and to ensure that they have been formulated in such a way that their validity cannot be called into question. That being said, some legal sites have pay-or-play contract templates that you can look at to get a general idea of what they do and what they look like. British singer Cheryl Cole was supposed to be part of the show`s jury, but was released early from her two-year contract because she feared american audiences wouldn`t understand her Newcastle accent.

She made a brief appearance in the American pilot of The X Factor, after which the series seemed to be done with her. Players are usually guaranteed a variable portion of their salary under strict contractual restrictions, as the sport presents an extreme risk of injury and the resulting high turnover rate of players. Now that we have a working salary or game definition in mind, it`s time to venture a little deeper into the rabbit hole. Once the “what” is discarded, we turn our attention to the “why”. Actor Johnny Depp may have 99 problems with his personal life, but money is not one of them. After the third installment of the Fantastic Beasts franchise and where to find them (Fantastic Beasts 3), Depp had a salary or a gaming contract under which he would receive $16 million, even if the film was never made or it was recast for some reason. The main shoot should begin in a year and last about six months, regardless of possible reshoots. That said, if Edie Falco takes over the concert, her commitment to the project would prevent her from taking on the dozen other roles as a baker in the meantime.

While a contract that guarantees the actor will be paid can help you attract top talent, it comes with inherent financial risks. Weigh the risk against the reward and, as with anything legally binding, it is advisable to ask an entertainment industry lawyer to create or at least review the compensation and gaming conditions contained in the contract before it goes live. To ensure that you will make your film, you must instead be engaged on a pay and play basis. This term is essentially a guarantee that you cannot be replaced. That`s pretty much in line with what most people in the entertainment industry consider when talking about “pay or play,” but it lacks the kind of legal precision that the courts prefer. “Guarantee” means the involvement of a third party who promises to pay if the main party does not perform. You can`t really guarantee your own performance or payment obligation. So, technically, a payment or gambling clause is a “promise”, but not a guarantee. Similarly, “no fault on his part” is somewhat narrow, as the clause could/should be triggered even if the person is not formally “exempted” from the contract. The producer can also adjust the agreement to give it flexibility in terms of how long the talent must be available for the film or when the funds must be paid. In addition, there are also other contractual provisions that apply not only to payment or gaming agreements that may be useful. These include moral clauses, force majeure clauses and others.

And let`s not forget the most important term: the amount of money. The producer would be well advised to negotiate a reduced amount he needs to pay for the talent in case the film does not progress for some reason. “Pay-or-play clauses can be incredibly powerful and beneficial under the right circumstances. However, it is important to remember that they also carry significant risks for everyone involved. The contract can include almost any duration, as long as both parties can agree on it. .