What terms should you include in your crew contracts?
Crew contracts usually include a number of standard terms, such as those covering rates, fees and expenses, the working day and week, holiday pay, pension entitlements and right to work.
But there are a number of additional terms which production companies may want to consider including in certain situations. Here’s a list of some of the most common contract terms in the film and TV industry and what they mean.
Producer discretion whether to use contribution
In some circumstances, a crew member may seek to argue a loss of opportunity or loss of income if a production is not exploited. As a result, many crew agreements contain a provision specifically acknowledging that the exploitation of the production will ultimately be at the production company’s discretion.
Warranties
A warranty is a contractual promise about a particular state of affairs. For example, almost all contracts will contain a warranty that the relevant party is authorised to enter into the agreement in the first place. Other warranties may include:
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That the crew member is entitled to work in the UK.
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That any contribution made by the crew member will be original and won’t infringe any third party’s rights.
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That the crew member has read, understood and agreed to all accompanying contractual policies.
Warranties are fundamental in underpinning the other obligations of a party under an agreement.
Indemnities
Indemnities are sometimes confused (or grouped together) with warranties, but they are different. A warranty is a promise about a particular state of affairs (eg, “I promise that I will not infringe any IP rights in performing my services”).
A warranty is supported by an indemnity; if a crew member is in breach of a term of the contract, they back their warranty with a promise to pay, on a pound-for-pound basis, the loss suffered (eg, “if I do infringe third party IP rights in providing my services and it causes you a loss, you can raise an invoice for the loss and I will reimburse you”).
That isn’t to say that the absence of an indemnity means that a party has no recourse for compensation under breach of contract. However, the indemnity effectively makes it easier for a party to recover its losses.
Indemnities are not always appropriate and are often subject to heavy negotiation.
Tax
Crew contracts should appropriately deal with how the fees will be taxed (ie, if tax and national insurance will be deducted at source). Ordinarily, fees are expressed as the gross sum and then subject to the relevant deductions. For self-employed engagements, you should seek a tax indemnity, making it clear that any tax obligations are the responsibility of the personal service company or individual.
For more information on your tax obligations, check out our guide to IR35 for production.
Working with children
Regardless of whether the crew member will actually work with children, it’s advisable to include a provision stating that they’ve never been cautioned or convicted of criminal offences, or in any way disciplined, in relation to conduct with children. The clause may also require the crew member to submit to a DBS check (the results of which must be satisfactory) before they can start work.
No injunctive relief
The purpose of this clause is to acknowledge that although a party may have some “equitable” remedies by way of an injunction, this is not economical in the film and TV industry. The essence of this clause is to say that in the event that the production company is in breach of contract, the crew member acknowledges the disproportionate impact of the injunction on the production and therefore agrees that damages is an adequate remedy. Note that the existence of this clause doesn’t prevent a party from seeking an injunction and, equally, the absence of this clause doesn’t automatically entitle a party to an injunction.
No authority to bind the producer
Crew members and HoDs are given various levels of authority in order to perform their tasks on a day-to-day basis. They may sometimes perform roles that suggest they have the authority to bind the production company when negotiating with external parties. This clause is therefore important to clarify that the crew member doesn’t have the power to bind the production company.
Assignability of contract
The film and TV industry often involves the transfer of benefits under contracts “up the chain” to a parent, commissioner or other third party. As a result, the production company must be able to assign (or “transfer”) its rights under the contract to another party. It should be noted that under English law, if the contract is silent on this, the default legal position is that the production company can assign its benefits under the agreement.
Given the default legal position, it’s important to state that the crew member cannot assign their benefits under the agreement as the benefits (eg, credit or right to payment) should be personal to the crew member.
Boilerplate
So-called “boilerplate” provisions should always be included towards the end of a contract. For a list of those which are most important in the film and TV industry, see 11 boilerplate provisions to include in your crew contracts.
Covid-19 terms
There are also a number of terms which production companies should include in their crew contracts to help minimise the impact of any future Covid-19 restrictions. For more information, see Contracting in a Covid-19 world.
For a step-by-step guide to contracting crew, see our checklist for production teams.