Agents - Business Managers - Visas      

 

Agents
    by Robert A. Livingston

An agent is a person or company, usually licensed by the state (call your State Attorney for licensing information), who acts for or represents another (who is called the principal) by implied or express permission. For example, an agent may act to secure work for an entertainer, or provide talent to those who are buyers of talent or provide persons with expertise to people in need of those expertise.

The principal is held legally liable for acts performed by the authorized agent. For example, a songwriter must allow the use of his song where it has been lawfully licensed by his representative agent. Or, an artist is financially responsible for purchases made by his road manager agent where the agent is acting to facilitate the artist's concert tour. Or, a record company is responsible for the actions of a producer who they have hired to produce a record.

Exclusive Agent

An exclusive agent is an agent that is employed by a person to be his sole agent representative (the agent usually signs the client, i.e., enters into a written agreement with the client, to protect agent's interests).

General Agent

A general agent is an agent who conducts a series of actions or performs a continuing service for the principal. These actions may include part or total control over the principal's business transactions, e.g., an assistant manager could be left in charge of an entire company while the owner or manager are out of town. The owner would be held liable for business transactions performed by the assistant manager during his absence.

General agents could have authorization to perform corporate voting, negotiate contracts, sell rights in copyright, or perform any number of business transactions for a company.

General agents can, in some cases, be appointed by the courts, e.g., if a person is found to be legally insane, the court would appoint an agent (executor) to handle the person's estate.

Special Agent

A special agent is an agent who carries out only a single transaction for the principal. This special assignment is given with specific instructions, but no powers of business related decisions-making are granted.

The authorized action may be of extreme or diminutive importance. It may be accomplished in minutes, e.g., a bellboy is instructed to deliver a package to a room down the hall. It may take years to perform, e.g., a private investigator is hired to deliver a valued family possession to a lost relative.

A special agent may be authorized to perform an act that only he, and not the principal, is legally capable of conducting, e.g., a patent attorney is hired to register an inventor's invention.

Artist Agent

An 'artist agent' is any person or company who is a bona fide representative of an artist. An agent may be hired as a manager, booking agent, business consultant, contract negotiator, use rights licensing agent, promoter, publicist, tax agent, etc..

Agents with Talent Agencies

Individual artist agents often work for talent agencies that are specialized to accommodate certain markets or to handle certain types of entertainment. Some talent agencies operate locally, others regionally, and some are large international agencies that are vary diversified. These large talent agencies may provide offices in major cities throughout the world. Departments of a large agency may include club booking, concert and college booking, publicity, film and video, television, commercials, and product endorsements and merchandising. And, they may represent a wide range of clients to include recording artists, entertainers, actors, TV personalities, producers, directors, comedians, sports figures, authors, composers, choreographers, screenplay writers, circus acts, and other novelty acts.

Artist Signing

Large talent agencies rarely sign unknown acts. When an artist becomes a lucrative "commodity" and is signed, the agent who first signs him is his principal representative and is called the responsible agent (RA).

The RA, however, will also rely on other agents in the agency (such as departmental heads) to handle his artist where the agency has internally delegated responsibilities.

When the agency is a large scale enterprise, it will attempt to maintain close interdepartmental coordination in order to promote the artist in a wide range of endeavors. Having this wide scope, for example, can speed up connections between a multi-talented artist's publicist, booking agent, and his perspective film producer or screenplay writer.

Since these large agencies represent such a wide variety of entertainment specialties, they are better able to serve a recording artist if he wants to expand his career. Career expansion may include other artistic and income generating endeavors such as acting or doing commercial spots. This "power to package" is one of the major advantages of a large talent agency.

Agent/Artist Relationship

An agent and artist should try to cultivate their relationship. For example, the artist should encourage the agent to offer constructive criticisms and allow the agent to have an input in shaping his career. A good agent can be an invaluable middleman in maintaining an artist's long-term success.

Because of the predominant value and investment in their working relationship, the artist should attempt to secure a provision in his contract (called a "key man clause") that would allow him the option to move with his agent if his agent changed agencies or was fired from his firm.

For example, a change in the agent/artist relationship could happen due to a merger or sale of the firm to a larger company, because of a court mandated break-up of the firm, or for various other reasons. Not having this clause could cost the artist a lot of money and headaches down the road. This is because the agency, in absence of the clause, could deny the release of the artist. If this happened, the dispute would have to be remedied in the courts. In the past, court decisions on this point often have favored the artist. The courts holding that personal relationships are entitled to special consideration.

Note, if a less than ethical attorney negotiates the initial agent/artist contract, he may purposely leave this clause out. This is because he knows that the courts have allowed the artist to go with the agent even where the contract was silent with respect to this circumstance. The attorney could purposely leave out the clause knowing he can rake in more money through litigation. He knows if he puts the clause in the contract to begin with, the artist could leave the agency and follow the agent with no extra litigation fees paid to the attorney. This is highly unethical but it can happen...

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Agents

 
Business Managers
    by Robert A. Livingston

Managers, especially those just starting out, must understand how their managerial duties are viewed in the eyes of the law--in reference to civil, criminal, and tax law especially.

For example, it is important for the manager to know if he is acting as a partner, an employer, an employee, an unlicensed (independent contractor) agent, or a licensed (independent contractor) agent!

For instance, if a manager acts as an employer while being an agent it could have highly undesirable consequences. Or, if he acts as a licensed agent while being an unlicensed agent it could have an even more disastrous outcome.

In light of the complications that may evolve, an astute manager would seek competent legal advice at the outset of his career. Or, if he has been managing in ignorance of the many laws that are applicable to his profession, getting legal help now could save him many future hardships.

Please be aware, this discussion is not written with the intent or purpose of offering legal advice. It is only written to encourage all managers and aspiring managers to seek a competent professional to get the facts straight before they find themselves in trouble.

Functioning Capacities

Here are the general (inexhaustive) definitions for the four capacities in which a manager may function:

1) Partner,
2) Employee,
3) Employer, and
4) Agent.

Partner

A partner is a co-owner of a business partnership. A partnership is a business association that is not a corporation. It is created through oral or written contractual agreement. The agreement must be made between two or more persons that have the capacity to enter into a contractual situation. If agreements are not in writing, the law would usually declare that an association is a partnership if the parties involved are sharing in profits and management.

The associates are co-owners and combine money, property, education, experience, skills, etc., to form a profit oriented business. Each partner is an agent of the company and assumes full personal liability for all debts and actions of the organization and/or its partners.

A partnership may be formed via a written agreement called "articles of partnership," or "partnership agreement." This instrument may include:

a) Partner's names,
b) Name of the firm,
c) Address of the business,
d) Kind of business engaged in,
e) Duration of partnership,
f) Duties of each partner,
g) Each partner's capital investment,
h) Percentage shares of profit (or loss),
i) Bookkeeping procedures, and
j) Termination provisions.

The ownership of property used in a partnership would be established at the outset of the venture. Each member of a partnership has an equal right to use property owned by the partnership as long as it is used for purposes of that partnership. This is true regardless of the percentage of investment held by each partner.

Management control of the business is equal for each partner regardless of the investment unless other contractual agreements are made. Where the artist manager acts in the management capacity but is not considered an equal partner, his responsibilities would be defined by contract.

Partners usually receive draws against expected business profits. This may, however, be arranged differently through contractual agreement. Partnership profits and losses are divided equally, in proportion to each partner's invested share, or however defined by contract.

Partnerships must maintain accounting records. These records must be available for inspection by the IRS or other authority.

As an artist manager who is acting in partnership with the artist he must be aware of his legal responsibilities and liabilities.

Employee

An employee is:

a) Any person employed under any contract of hire,
b) A person, below the executive level, employed by an employer and paid a salary or hourly wage, or
c) For tax purposes, any person who receives a salary or hourly wage.

Employer

An employer is a person (or business) who has one or more employees working for him.

An employer pays the employee a salary or wage. He hires and fires employees. An employer must comply with federal and state laws.

An employer must withhold from his employee's wages, taxes levied on employees such as employee income tax and social security tax, unemployment or disability insurance, and other amounts where required by law.

Employers must pay these taxes to the proper government agency, in the amounts and according to the time schedules directed by law.

An employer must also pay the tax levied on employers for social security to the proper government agency.

Employers must pay employers workmen's compensation insurance.

Employers must pay unemployment tax levied on the employer himself.

Employers must comply with federal and state labor laws. They must maintain records on each employee recording hours worked and wages paid.

An employer must keep tax records and file the proper federal and state tax returns.

Employers must comply with an obscene number of city, county, state, and federal laws that regulate businesses in general.

It can go on seemingly forever! New laws that regulate employers are enacted almost daily.

Agent

In short, an agent is a person who acts for, or represents another (who is called the principal), by implied or express permission. The principal is held liable for acts performed by the authorized agent if the agent has not previously agreed to accept certain liabilities or unless the agent is legally licensed and by law is held liable himself.

Under tax law, an agent is an "independent contractor" if he (or his business) performs a service for another under verbal or written contract, as opposed to a person who works for wages or salary (employee). A contractor retains control of the means, method, and manner of execution or production concerning the work contracted...

 
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Manager--A Closer Look
 

 

 

Visas
     by Robert A. Livingston

A visa is an endorsement made on a passport that validates the fact that the bearer is allowed to enter into, or work in, a foreign country.

We have, by far, the largest music market in the world and it is the desire of many artists from abroad to come to the United States to try to exploit that market. All of those foreign nationals who come here (called aliens) come under the jurisdiction of the U.S. Immigration and Naturalization Service (INS), the U.S. Department of Justice, the Department of State, and the Department of Labor.

These agencies operate according to U.S. law and especially with respect to the Immigration and Nationality Act.

It is the INS who issues the visas that are needed to enter, visit, and work in the United States.

According to law, certain aliens are issued visas and admitted without limitation, while others have annual numerical restrictions. Other aliens are admitted according to numerical limits and according to their status of preference.

For example, aliens who are performing artists, may be preferred because of their exceptional abilities if they "substantially benefit prospectively the national economy, cultural interests, or welfare of the United States and whose services in the professions, sciences, or arts are sought by an employer in the United States."

To support the claim of exceptional ability, the alien should submit written documented evidence that "may testify to the universal acclaim and either national or international recognition accorded the alien, show that he has received a nationally or internationally recognized prize or award or won a nationally or internationally recognized competition for a specific product or performance or for outstanding achievement."

Other non-performing arts and science aliens may be admitted because they fit into certain schedules where labor certifications are issued in advance of any job offer. These occupations may include musical producers, writers, and arrangers.

Aliens who qualify are issued a visa by the INS. Visas are either permanent (called "Green Card" visas) or temporary (called "H-1" or "H-2" visas).

Green Card

A green card is a card issued by the Immigration and Naturalization Service that acknowledges an alien has fulfilled the requirements for labor certification. The card is a visa and allows the qualifying alien to work in the United States for an unlimited duration.

The visa is granted or denied by certifying officers in the national and regional offices of the Employment and Training Administration of the Department of Labor, or by officers in the U.S. Counselor's Office.

The main criteria considered in order to obtain the visa are:

a) A finding that there are not sufficient United States workers who are able, willing, qualified, and available for the employment, and

b) That the employment of the alien will not adversely effect the wages and working conditions of U.S. workers similarly employed.

An application for labor certification may be filed by an employer or alien. The employer must file with his local State Employment Service Office. Aliens may apply with the U.S. Consular abroad, or with the Immigration and Naturalization Service Office in the United States.

It is possible that some aliens who qualify with respect to the preferences may be denied visas and prohibited from entering the United States. This can happen, for example, if the alien has had a prior criminal record, is a drug addict, or has certain infectious diseases.

For further information procure tax publications #513, #514,#515, #518, and #519 available from any IRS office.

H-1 Status

H-1 status is the name given to a particular temporary work visa granted by the Immigration and Naturalization Service of the Department of Justice.

It is granted to aliens who have distinguished merit and ability and come to the United States to perform services of an exceptional nature.

Petitions for H-1 status should be accompanied by written documents describing the aliens abilities, references, and other documented evidences such as awards, etc. to substantiate the claims.

For further information procure tax publications #513, #514,#515, #518, and #519 available from any IRS office.

H-2 Status

H-2 status is a temporary work visa granted by the Department of Labor to qualified aliens who do not qualify for H-1 status, i.e., they do not have "distinguished merit and ability."

 For example, if a foreign band were touring the States, their touring stage hands, etc. could be considered for H-2 status visas.

For further information procure tax publications #513, #514,#515, #518, and #519 available from any IRS office.

Immigrant Status

Immigrant status is the position or level an immigrant holds with regard to the work permit (visa) issued to him before entering the U.S., e.g., H-1, H-2, or Green Card status. An alien who secures a visa and enters the U.S. is said to have "immigrant status."

For further information procure tax publications #513, #514,#515, #518, and #519 available from any IRS office.

Multiple Entry Visa

A multiple entry visa is a visa that allows an immigrant worker to leave and return to the United States without renewing the visa upon each re-entry.

These visas are valid for a limited time (up to one year) and offer only limited renewal privileges (up to 3 years in certain instances).

Work Visa

A work visa is a temporary work permit issued to an alien desiring to work in the United States...

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Visas