Most actors or other entertainment talents retain an agent or manager to represent them. This usually involves signing a talent representation agreement that defines the services provided by the agent and the compensation received in return. Talent agencies use a standard agreement known as a general services agreement. Rules controlling these agreements vary by state, but regulatory authorities in California and New York oversee general services agreements in those states.
An agency franchised by the Actors’ Equity Association or the American Federation of Television and Radio Artists may require an actor to sign a union agency agreement. If the general services agreement and the union agency agreement cover different sets of services, the actor may need to sign both agreements. Union agency agreements favor the actor more than a standard general services agreement, since the union regulates their provisions.
Managers and Talent Attorneys
Some actors may choose to hire a manager and a talent attorney as well as an agent. Agreements with managers resemble agency agreements. However, they are not regulated by the state or overseen by a union. Meanwhile, "talent attorneys" help actors review any legal agreements that they sign, rather than actively seeking work for the actor. Agreements with these attorneys are similar to other legal representation agreements. A talent attorney may receive a commission on earnings rather than the standard hourly fee.
Scope and Duration of Talent Representation Agreements
While general services agreements tend to broadly define the services provided, an actor might be able to negotiate exclusions from an agreement. These might include projects that are already underway or work in a different field. An actor signing an agreement for representation in TV projects, for example, might want to exclude theater work.
Most talent representation agreements last for a term between one and five years. (The Actors’ Equity Association and the American Federation of Television and Radio Artists each limit the term of an initial representation agreement to one year.) Agreements can be renewed for a longer term. In many cases, general services agreements and union agency agreements both can be terminated if the actor does not get a minimum number of engagements or a minimum amount of income during a period provided by the agreement, which is often a few months. This allows the actor to end an unproductive relationship and pursue alternatives.
Compensation for Talent Agents
Talent agencies usually apply a set commission percentage. If an agent is subject to provisions imposed by a union, they will be limited to 10 percent of earnings. Managers may collect greater commissions, but they usually will not ask for more than 10 percent if the actor also employs an agent. Actors should not expect to make upfront payments to an agent in addition to a commission fee. Sometimes an agent justifies a request for upfront payments by promising that they can obtain a certain amount or type of work. These promises are unethical and usually illegal.
Commissions After an Agreement Ends
A talent agent may try to claim a commission for work performed by the actor after an agreement expires or is terminated. However, both general services agreements and union agency agreements should allow an agent to claim a commission only from projects that were substantially negotiated by the agent.
Package fees may replace commissions in some cases when a large agency represents several clients for the same project. For example, an agency might represent the director of a film, the male lead, and the screenwriter. In this situation, the agency might define their compensation as a percentage of the budget or the license fee for the overall project.