Memorializing Relationships Early Pays Off Later Part 2: Does a Film Producer Make a Mistake By Not Entering Into Work For Hire Agreements with Film Crew, Talent, Writers and Other Independent Contractors Whom She Hires?

POSTED ON March 5, 2019 / IN Documentary Toolkit

BY:

STEVEN C. BEER, JAKE LEVY AND NEIL J. ROSINI

This Q&A was originally published in the Winter 2019 issue of Documentary magazine, a publication of the International Documentary Association, a nonprofit media arts organization based in Los Angeles.

Yes, it’s generally a mistake for a producer who intends to own a film not to enter into written work for hire agreements, especially with contributors who are independent contractors rather than regular employees. This is because the absence of written work for hire agreements can leave ownership of the finished film — and all the elements leading up to it, such as a treatment, script, and raw footage — up in the air.  This can have a devastating effect on the producer’s ability to control exploitation of a film through licenses and assignments of rights.

To understand the scope of that effect, consider that creators of all types, including independent contractors working on a film, generally are presumed to own their copyrightable works from the moment of creation.  Works for hire are an exception to the rule that an “author” (that is, the creator) owns the copyright in what she creates. If an employee creates a work for hire as an “employee for hire,” the employer (such as a film producer) owns the copyright in that work from the moment it comes into being. Otherwise, the creator owns the copyright.  (A third category, if both parties so intend, is joint ownership and it can also cause trouble if the producer intended to own everything, but we’ll save that discussion for another day.)  If a contributor is not clearly made an employee for hire, ownership in her contributions might be unclear, too.

Under copyright law, works for hire come about in one of two ways: either they are prepared by “regular” employees within the scope of their employment or they are created by independent contractors as employees for hire provided that a pair of conditions are met.

Who is a regular employee? The law considers about a dozen mostly intuitive factors to distinguish a regular employment relationship from that of an independent contractor. Those factors include: whether employee benefits are provided to the employee; whether a specialized skill by the employee is required; whether the work is performed on the employer’s premises using its equipment; the duration of the relationship; whether the employer can assign additional projects; the extent of the employee’s discretion over when and how long he works; whether the hired party hires and pays his own assistants; and whether the work is regular part of the employer’s business.

For example, a writer who is on-staff and does whatever project is assigned at the employer’s place of business during regular business hours, and receives medical insurance and other benefits through the employer, is likely to be deemed a regular employee.  On the other hand, a field producer who works on a project basis, doesn’t report daily to an employer’s place of business, and neither receives benefits nor has withholding taken from her paycheck, will probably not be considered a regular employee.

But if not a regular employee, is an independent contractor always an employee for hire?  No, because there are still two conditions to be satisfied according to the Copyright Act. First, the independent contractor’s work must fall into one of nine categories specified in the Act.  Because audiovisual works is one of those categories, commissioned contributions to documentary films generally satisfy this first condition. Second, there must be a written agreement signed by both parties that makes the independent contractor’s efforts a work made for hire. If both conditions are not met, the creation is not a work for hire and the copyright in the independent contractor’s independently copyrightable contributions usually belong to him, not the employer.

In contrast, no written agreement is required for the work of a regular employee acting within the scope of her employment to be deemed a work for hire in which the employer owns the copyright. Nevertheless, having a written agreement usually makes sense for both parties.  From the employee’s perspective, the “scope of employment” can be defined so that whatever the employee creates on her own time outside that scope clearly belongs to her.  From an employer’s perspective a written agreement often makes sense when the variables distinguishing an independent contractor from a regular employee don’t line up on one side. For example, what’s the status of someone with a specialized skill who works part time on the employer’s premises and doesn’t get benefits? At the very least, the answer isn’t obvious.

Lack of a clear answer to this essential question can lead to litigation, which is costly, may delay exploitation, and can occasionally take the law in new directions.  An appellate court decided in a relatively recent decision that even without a written agreement, a director’s work on a film belonged to the production company that hired him because, among other reasons, the director’s contribution was not a “freestanding piece[]” constituting a “work of authorship,” the crew that was hired by the production company rather than the director captured the director’s efforts on film, and the director was not the “dominant author” of the raw film footage.  Similarly, in another appellate decision an actor who signed no work for hire agreement claimed a copyright interest in her performance, yet the producer was found to be the owner.  But these decisions weren’t based on literal interpretation of the Copyright Act and unless and until that statute is changed, work-for-hire agreements made at the very beginning of work by a contributor on a project offer the safer way to ensure ownership by the hiring producer.

–Neil Rosini

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