Work-for-hire agreements and how they affect your business — whether you contract for or shoot adult content for any media — is a major first step toward defining what you own and securing your future as a producer and purveyor of adult content.
Most studios, directors and cameramen truly believe that the person who pays for the content owns it. This is not necessarily true.
Works created as part of one's job, referred to as "works for hire" are treated differently than those works created by independent authors and independent contractors. An employer is entitled to the fruits of his or her employees' labor. Section 101 of the Copyright Act of 1976 defines a work made for hire as:
1) a work prepared by an employee within the scope of his or her employment; or a work specifically ordered or commissioned for use as a contribution to a collective work, as part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire.
There are two ways to create a work made for hire. The first is through an employment relationship between the commissioning party and the creator of the work. For example, a studio hires a director-cameraman and editor and places that person on salary paid through a payroll by the studio with taxes being withheld and deducted from his or her pay. This is a typical employer-employee relationship, irrespective of the industry.
According to Section 201(b) of the Copyright Act: 1) [T]he employer or other person for whom the work was prepared is considered the author for purposes of this title, and, unless the parties have expressly agreed otherwise in a written instrument signed by them, owns all of the rights comprised by the copyright.
From my experience, many studios hire directors, cameramen and editors as independent contractors and not payrolled employees. This can and will create a relationship that cannot be classified as an employer-employee, which then means that unless the studio has a signed work-for-hire agreement from all parties that had creative input into your scene or movie, they, not the studios, actually jointly own all the rights pertaining to that work. Further it should be noted that the director, cameraman and editor have merely granted the studio a nonexclusive license in the content, which can be rescinded and revoked at anytime by the joint copyright owners.
An independent contractor can be defined as a person who renders service in the course of an independent employment and who follows the employer's desires only as to the results of the work, not as to the means whereby it is to be accomplished. Further, it is a common practice within the industry to claim that anyone on an adult production set is an independent contractor and not an employee. In an effort to save the studio on payroll taxes and the necessary workers compensation insurance, this is a common mistake that can have dire consequences when it comes to who owns the copyrights to the content that has been procured.
Without a work-for-hire agreement signed by the director-cameraman and editor, a studio will not own the content they have paid for. With every independent contractor agreement, a corresponding work for hire agreement must also be executed. Without a signed agreement, copyrights cannot be waived.
For years the debate as to whether a specific work was a "work made for hire" was a source of great confusion. However, in 1989 the U.S. Supreme Court resolved much of the confusion surrounding the issue of who was an "employee" and who was an "independent contractor."
The court concluded that "common law agency principles" must be used to determine whether the work was prepared by an employee or an independent contractor. The court enumerated several factors in determining whether a hired party qualifies as an employee or is instead an independent contractor: (1) the hiring party's right to control how the work was accomplished, (2) the skill required, (3) who provided the materials and tools, (4) where the work was performed, (5) length of relationship between the parties, (6) whether the hiring party could assign additional projects to the hired party, (7) extent of hired party's discretion over when and how long to work, (8) method of payment, (9) who hired and paid assistants for the project, (10) whether the work was part of the hired party's regular business, (11) whether the hiring party is in business, (12) did the hiring party pay employee benefits, and (13) the tax treatment of the hired party.
The Supreme Court also stated that these factors were not an exhaustive list. No single factor was determinative of whether a hired party would be considered an employee. The significance of this Supreme Court decision was its conclusion that the two prongs of the "work made for hire doctrine" were mutually exclusive. Furthermore this decision restricted the "work made for hire" doctrine under the first prong to "actual" employees while the second prong was held to be only applicable to independent contractors.
As an aside, it should be noted that the Copyright Act imposes two requirements to create a work-for-hire situation for specially commissioned works created by independent contractors that apply to the adult industry. The first relevant aspect is (1) a contribution to a collective work and (2) a part of a motion picture or other audiovisual work. Obviously these two do apply to the industry. Therefore, without a signed release that is unambiguous as to the agreement waiving copyright, the independent contractor retains all copyrights.
What does this mean for you? Well, if you are a director who owns his or her own production company and have shot content for numerous studios and have not signed a work-for-hire agreement, you may still own the copyrights to all that content and could revoke the studio's rights to use, display and profit from your work.
A director who does not own his or her own production company but still has worked for several studios and has not signed a work-for- hire agreement, then you also still may own your work and have the studio's rights rescinded accordingly. Further, you very well might be entitled to a share of the profits from the sale of your work.
Agreements Are Key
If you are a studio or a party that commissions adult content, use work-for-hire agreements liberally. If you have not used such an agreement in the past and have not paid those with creative input via a payroll with taxes deducted, you might not own the rights to the content that you are profiting from. Eventually, your studio may be forced to share those profits with the director-cameraman and editor and/or be forced to stop distributing the content in question.
Basically anyone who has creative input into the final product could have a copyright interest in it. Therefore, work-for-hire agreements should be invoked liberally when attempting to decide who to provide one of these contracts or forms to.
It is better to have too many potential independent contractors execute them rather than make a mistake as to who may or may not have creative input into your content.
More specifically, the following guidelines should be followed to help you obtain and retain copyright ownership of creative works that are intended to qualify as a "work made for hire."
1. Have a written contract between you (the studio) and any independent contractors who may be "hired" (directors, photographers, videographers, editors etc.).
2. Have a written "work made for hire" agreement with all freelancers and independent contractors who create works that you want to qualify as a work made for hire.
Merely stating that this is a "work made for hire" agreement does not make it one; all the requirements of the independent contractor prong must be satisfied.
3. Make sure the written work-made-for-hire agreement is signed by both parties before the creation of the work.
4. Include an appropriate "assignment" clause in the work-made-for-hire agreement that will serve as a backup if the work does not qualify as a "work made for hire."
It is strongly recommended that you contact an attorney familiar with copyright law and work-for-hire agreements to further discuss the issues raised by this article in regards to your business or rights.
This article is not exhaustive on this particular issue, and there may be conflicting laws and standards depending on what geographical region in which you operate your business.