The direct and indirect costs of recruiting, onboarding, training and maintaining your crew Since we make no secret about the rates we charge our clients or what we pay our crew members, we are often asked to explain the delta between the two amounts. For those unfamiliar with those rates, the average sell rate is roughly 40% over the pay rate. Depending on the role and dynamic costs such as Workers Compensation Insurance, this is not an unreasonable amount. Typically, when those questions arise, the conversation is clarifying, rather than justifying, what is often mistaken as gross profit. Truth is, and any business owner with one or more employees knows this to be true, the cost of labor can be stifling, especially in states with high minimum wages, mandatory benefits, and strict definitions pertaining to 'who is a contractor.' Less talked about are the indirect costs of labor, which can go so far out of control that many employers and contractors are overwhelmed by the challenges they face. We publish this article to more completely explain the actual costs that are involved in maintaining a full-time, part-time and contingent workforce, the direct costs such as payroll, employer taxes, benefits and insurance to indirect costs such as processing expenses, operating costs, invoice exceptions, and time-theft. We'll touch on the pros and cons of using an independent payroll service, managing a contingent workforce and the increased regulatory compliance. In the end, any average company will have the resources to analyze the cost to benefit when deciding their optimal workforce mix. NOTE: As you read on, be mindful that all companies, and even entire industries, will have major and subtle differences in their business model, culture and/or vision statement - all of which can influence or adversely impact the cost factors described below. Equally important to consider, some organizations will have a higher tolerance for risk, reside in states with more or less regulation, are subject to more or less oversight, or simply have a shallow talent pool - but for the most part, this article is applicable to a broad range of California employers, from any industry, and does not pertain strictly to the live event industry. Direct Costs Direct Costs are those expenses directly connected or associated to the wages earned by an employee or contractor. These are the costs that quickly come to mind when you think of Cost of Labor, such as the taxes, processing fees, benefits and liabilities. Payroll Expenses Employee Payroll / Contractor Fee: This is the sum amount of the monies owed to the employee or contractor. This can be an hourly-rate, day-rate or flat rate - although there are some rules that must be followed when calculating flat-rates to ensure that regardless of the agreement, the amount paid is higher than the applicable minimum wage. Payroll Tax: This includes the employer contribution for federal, state and local taxes and government insurance, such as Medical and Unemployment. The employer contributions for Federal include Social Security (6.2%), FICA (1.45%), FUTA (0.6%) and in California, the SUTA for new employers (3.4% for new California employers), plus any local or municipal taxes. Job Expenses: Costs accumulated by company personnel at the job-site, such as parking & tolls, crew meals, equipment rentals and expendables, etc. General Liability Insurance: A policy limiting your company’s liability for claims made resulting from an accident caused by one of your employees. In some cases, you can request freelance contractors indemnify you and name you as Additional Insured on a policy they may carry. But less established techs rarely carry their own liability and therefore must be covered under yours, as necessary. And employees are automatically indemnified by their employer, except in cases where the employee acted in a fraudulent manner or in violation of applicable laws without employer knowledge. Workers Comp Insurance: Insurance providing disability benefits as wage replacement and medical care and benefits to employees injured in the course of employment in exchange for relinquishment of their right to sue your company for negligence. This insurance is mandatory for all employees, whether part-time or temporary - and if your contractors fail to provide their own workers comp insurance, for many jobs the contractor must be covered by your company’s policy. Failure to do so could result in the contractor filing a claim against your end-client’s policy - which won’t go over too well with most end-clients. Commercial Auto Insurance: If you’re going to have a contractor or an employee drive vehicles, like trucks, cargo vans, passenger fans or even their own vehicle to run and pick up supplies, commercial auto insurance provides protection from liability, injury or collision damage if they get into an accident. And be careful to read the fine print on your rental truck agency agreements. It’s a misperception that your personal auto insurance will cover your rental van. Where they may be true as you drive it away from the lot, the moment you put people or gear in it that’s work related, most policies won’t cover an accident or the costs of collision damage, theft, property loss, personal injury, medical expenses or possible punitive damages. Processing Expenses Merchant Processing Service Fees: Cost for processing a credit card payment which will vary by company based on volume, risk and credit rating. Fees can be as low as 1% or as high as 5%, but the average for small businesses that accept payments by phone or thru companies like Paypal, the average is a base rate of approx. $1, plus 3% of the sale. Invoice/Payroll Processing: It takes time and resources to process an invoice and payroll for payment. It might seem simple enough. Print it, pay it. But there is a process that must be followed to allow for adequate tracking and audit, including verification of the hours, accounting entries, client approvals and the resources to complete, run and file the payment. On average the all-inclusive cost to manually process a single invoice can range from $12 to as high as $40 per invoice. Invoice Payment Transaction Fees: Our normal process to pay invoices is a company check mailed on Fridays for invoices received by EOD Tuesday. However, as a consideration for our crew, we have paid using Venmo, Paypal, Western Union and a number of other systems. Most charge a transaction fee, ranging from a couple dollars to a percentage of the transaction total. Invoice Exceptions Expenses: Since time cards or contractor invoices often do not match up with employer-provided time sheets, extra time must be devoted to researching and investigating Exception invoices. This sub-process takes that invoice out of the queue for processing until it can be handled individually and adds additional days and associated costs to it’s processing. In many cases, invoice exceptions do not represent a minority of transactions, but can range between 50-70% of a given job. Indirect Costs Indirect Costs are those expenses that are incurred in the process of recruiting, onboarding, training, soliciting, scheduling, managing, paying and terminating an employee through the cycle of their employment. Also underestimated, these costs may also include hard and soft costs associated with loss of opportunities or revenue, such as court and legal fees, collection costs, disability/unemployment claims, penalties & fines, adverse decisions & punitive actions, as well as the loss of clients or liabilities surrounding employee fraud or negligence. Cost of Job/Sale This list includes the additional costs associated with each sale. Some of the lines include ambiguous references to company personnel. It’s important to remember, like the staff required to process an invoice, there are other costs associated with making the job happen, such as: making the job possible, ensuring we have the means to fulfill it, and promoting our ability to do the job. Similar to operating expenses (which we describe below), the lines here should be summed up and divided by the total number of jobs. That remaining value is the sum total of all the indirect resources that are required to make the job even possible. Materials: The cost of any materials or supplies used in the execution of the job. This can be as simple as file folders & labels and paper & ink, but might also include specialized gear and expendables such as custom tool kits, specialized electronics, personal protection equipment, personal hydration devices and first aid supplies. Human Resources The cost of supporting roles that must be factored in as a cost of doing business. They include all the personnel required to run the business effectively, but are not in a role that can be billed directly. Administration: The cost of the administration staff required to manage the day-to-day administration of the company, from corporate governance and compliance audit to management of Human Resources and Finance. Recruiting & Onboarding: Cost associated with providing specialized personnel to solicit, recruit and interview new candidates; then guiding successful candidates through the Onboarding and orientation meetings or webcasts Training & Management: Costs associated with providing specialized personnel to perform training and workshops, as well as costs required to provide effective and efficient management. Marketing & Marketing Operations: Costs associated with compelling clients to buy. These costs include demand generation, lead nurturing, advertising, promotion and sponsorship - as well as the systems and processes required to ensure they are accurate and effective. Sales & Sales Operations: Costs associated with capturing the sale and fulfilling the order. These costs include commuting and travel to and from job sites, potential lost opportunity, business development, account management, materials and collateral, etc - as well as the systems and processes required to control spending and record accurate and profitable transactions. Operating Expenses The following list includes the various costs incurred to operate the business on a day-to-day business. The gross profit from the cumulative sum of all the jobs must cover these basic operating expenses or the business will be in the red at the end of the year. Therefore the operating budget per job would be the total annual operating budget divided by the total number of jobs for the year. That dollar amount is the average that all the jobs must clear, no top of all the expenses listed above. This is just a sample list, and not exhaustive - but you get the picture: Office Salaries: Office personal including Labor Coordinator, Accountant, Office Manager, Sales & Marketing personnel, Operations & Production personnel Office Wages: Includes any non-salaries positions including admin assistants and clerical staff Office Lease & Utilities: Includes office lease, warehouse lease, building improvements, as well as gas, electric, water and garbage. Telecom: Includes landline, toll-free, fax and mobile numbers - and may also classify high speed internet and digital cable. Professional Fees: CPAs and bookkeepers fee for managing books, preparing and filing taxes, performing audit review and representing taxpayers during an audit, as required. Lawyer(s) for contract review, document prep/review, negotiation, litigation, litigation defense, trademark/copyright protection, infringement, legal complaints or responses and other related actions. Supplementary Insurance: Umbrella Liability, Errors & Omission, Equipment Damage or Replacement, Medical, Dental and Vision, etc. Office Furnishings Office Supplies Monthly Bank Fees Loan Interest Annual Fees (see below) Annual Fees Trade Membership Fees: Professional trade organizations or associations Vehicle Registration: State vehicle registration, tags or certs Software Licenses: Accounting, CRM, Office apps Municipal Tax, Licenses & Permits: City Tax License, Reseller License, EDD Permit State Tax Prep & Corporate Filing Fees: Articles of Incorporation, Board Minutes, Income Tax Prep & Filing Fees: Tax Forms, Quarterly Payments, Lost Revenue/Opportunity Service Recovery: Discounts or refunds returned or credited to clients due to poor or substandard performance of the part of an employee or contractor that is deemed unacceptable and therefore not collectable - not is it recoverable or reimbursed by the employee or contractor. Bad Debt: Any sum of money unpaid on invoice(s) due that are deemed unrecoverable, typically the result of client financial troubles, poor service recovery, lack of proper record keeping or degraded client relations. Late Payments: Cost associated with receiving payments late. This can include interest paid on short term loans or amounts balanced on credit cards requiring an additional service charge and/or interest charge. Lost Sales Opportunity: This happens for a number of reasons, including problems with crew or crew chemistry, poor performance, poor communication or poor business process. When calculating the value of a lost opportunity, don’t measure just the lost future sales projections. Try to measure and quantify the cost invested into acquiring the client from the beginning. This is a pretty comprehensive list of everything that goes into hiring and managing a production management staff and/or event production crew - however it’s not an exhaustive list, since as mentioned earlier, these account for the basics of the business. Be sure to consult with a professional that understands your business and the laws of your state before editing your existing process based on what you learned here. Let’s demonstrate an example of the True [Real] Cost of Labor is, factoring in some of the variables discussed above. To make this exercise easy to follow along, we’ll use some round numbers and some values from my previous company. This is based on a small company that does an average of $350k in net sales and $210k in payroll expenses. It’s also based on a new employer paying into Unemployment insurance and a Workers Comp rate of $0.08 per $1.00 of pay. This does not compute all the lines we reference above, but granted, it’s a small company. The data represents a real-life scenario, but there are so many factors that contribute to the top and bottom line, that hopefully this simply makes you aware of the factors that not only labor companies face - but yourself face them. I’m actually surprised how many small companies are facing them, and don’t even realize it. # # # # Important Notice: This article is an opinion editorial and not intended for use to determine your company's legal or regulatory compliance. This is not a legal publication, so it can aid in your research and understanding, but it shall not be construed or regarded as legal advice or instruction. Before taking any action, based on what you've read in this article, be sure to consult with your lawyer or accounting professional - or other licensed business professional familiar with the laws of your state and municipality.

Christina Amato is a dynamic vocalist, songwriter, and entertainer who brings youthful energy, fresh style, and commanding vocals to any venue. With millions of video views and more than 41,000 subscribers on YouTube, her fan base is exploding around the world. In her early 20’s, Christina is already a seasoned performer who has appeared at the most prestigious venues throughout her hometown, Las Vegas, as well as up and down the West Coast, the southwest, and throughout Europe. Christina has also been in the studio non-stop working on her own original music. Working alongside acclaimed producers, she has been writing music and contributing vocals to DJ’s worldwide. You can find some of her original music on iTunes, with new releases soon to come. Christina was born into a very musical family. Her father, Tommy Amato, played alongside Bobby Darin, Tony Orlando, Tina Turner and many more. Because of her upbringing, Christina has mastered a wide repertoire; her voice effortlessly handles many different genres including pop, jazz, soul, R&B, funk, and international hits. Her playful stage presence makes her a hit with any crowd. Unlike most cover bands, she also performs her own original music, indicating that she is a complete musical artist. Christina can be booked as a duo, trio, or a full band depending on your needs and budget. She is available in Las Vegas, throughout the US, and abroad. Talent alone is never enough. And although Christina Amato has talent in spades—a powerful voice and a knack for turning her favorite songs into something personal and different—she knows an artist needs to know how to build a brand. “Since I was very young, I realized the power of social media and how much influence is there, and also how it allows you to be yourself and find people that enjoy your authentic personality,” says the 23-year-old, Vegas-born singer. “I’ve been using live-streaming, Periscope and Instagram to brand myself not only as a singer but blend together fashion and travel and style into one thing.” Amato has music in her blood. Her musician dad, Tommy Amato, came to Vegas in ’68 and worked in all the big showrooms with all the big singers, including Bobby Darin. It was easy for Christina to learn how this entertainment city worked, and she began singing regularly at 19 with Zowie Bowie. She quickly put together her own band and grabbed a weekly gig at Blue Martini, and has more recently performed at the Sayers Club. Amato operates with the patience of a seasoned performer, onstage and off. “In the next three to five years I’d like to have an album out, but I’d also love to be writing for myself and others,” she says. “And I want to take social to the next level, build something more like a lifestyle movement than just someone who sings.” Sparks | Official Video https://www.youtube.com/watch?v=hk4OK2byoD Rather Be - Clean Bandit Cover Song https://www.youtube.com/watch?v=NkklBlUnU6I All of Me | John Legend Cover Song https://www.youtube.com/watch?v=qibkbBhmlDU https://soundcloud.com/realchristinaamato/butterflies https://soundcloud.com/realchristinaamato/no-filter

Common misconception about how event professionals are classified by the IRS We're often asked the difference between employee and freelance stagehands. It's interesting how many stagehand and show crew operators don't understand the basic differences between classifications before taking on a job(s) that impact how they may be classified. Frankly, there can be a number of subtle benefits and challenges associated with every classification. We've listed and detailed some of the basics below, and we welcome your thoughts and opinions. We've narrowed down the broad range of classification to 3 basic categories: 1. Union Member, Temporary Employees ​2. Non-Union, Regular Employees 3. Freelance Independent Contractors There are a number of subgroups under these three categories, such as Permalancers, Contract Employees, Seasonal Employees, Part-Time, Full-Time, etc. Of course there are variations and exceptions, but for the most part, they all fall into these three basic categories and the pros & cons are the most common for that group. Union Member, Temporary Employees Union Stagehands are often grouped into Card Holders and Permit Workers or Over-Hires. They are not necessarily considered employees of the union, but more accurately, they are temporary employees of a production house, theater, payroll agency or other such company authorized to hire them under the union's Collective Bargaining Agreement. IRS Form to Report Income: W2 Income Taxes Withheld: Yes Work Expense Deductions: No (some exceptions) Home & Auto Deductions: No IRS Schedule C: No Payroll Liability: Strict Payroll Tax: Paid Employer Health Benefits: Paid by Employer Retirement Benefits: Paid by Employer Legal Liability: Worker is Indemnified Liability Insurance: Paid by Employee Workers Comp Insurance: Paid by Employee, Mandatory Calendar/Time Management: Employer (Union) Process/Job Assignment: Employer Right of Refusal: Employer Non-Union, Regular Employees​ These are full-time or part-time, regular or season employees hired by production companies, gear houses, scenic shops, theaters, stadiums and other live event venues where you'd find stagehands on regular staff. IRS Form to Report Income: W2 Income Taxes Withheld: Yes Work Expense Deductions: Few (see IRS regulations) Home & Auto Deductions: No IRS Schedule C: No Payroll Liability: Strict Payroll Tax: Paid Employer Health Benefits: Paid by Employer Retirement Benefits: Paid by Employer Legal Liability: Worker is Indemnified Liability Insurance: Paid by Employee Workers Comp Insurance: Paid by Employee, Mandatory Calendar/Time Management: Employer Process/Job Assignment: Employer Right of Refusal: Employer Freelance Independent Contractors Freelancers can most accurately be described as small business owners/operators. They are small, one-person shops that solicit, perform, and close out each job. Being a small business comes with a number of responsibilities, but also has its benefits. Among the most important benefits, besides tax and income flexibility, is the right to refuse or accept jobs and to control your own calendar. IRS Form to Report Income: 1099 Income Taxes Withheld: No Work Expense Deductions: Yes (see IRS regulations) Home & Auto Deductions: No IRS Schedule C: Yes Payroll Liability: Strict Payroll Tax: Paid by Worker Health Benefits: Paid by Worker Retirement Benefits: Paid by Worker Legal Liability: Worker Liability Insurance: Paid by Worker Workers Comp Insurance: Paid by Worker, Not Mandatory for Sole-Proprietors Calendar/Time Management: Worker Process/Job Assignment: Worker Right of Refusal: Worker

Are you new to event production? Have you been listening in on conversation and feel like you're way outside of some inside joke? Well, here's a short list of some of our trade & colloquial terms we often use, their meanings, and their actual meaning. "Best Gig Ever!" "Worst gig ever!" ​"We only want to do this 'twice' once!" "First we do it the Producer's way, then we'll do it the right way." Setup Blacks Black pants, black shirt, black shoes - the entire right side of a stagehand's closet. Show Blacks Black slacks, black button-up shirt, black shows - the other side of a stagehand's closet. Dress Blacks Black slacks, black coat, black tie - balled-up in the stagehand's trunk or in the back of their closet. Workbox Mammoth-size road case filled with every tool ever used, adapters for every connection ever invented, every custom contraption ever imagined, food menus from every city ever visited, Basically, the workbox is a 500 pound security blanket on wheels. Gack Box A large rolling case full of random crap we couldn't fit in the Workbox. C-Wrench The only tool you won't find in the workbox (but you will find it in every lighting tech's pocket. Left-handed or Metric C-Wrench See "Flux Capacitor" E-Tape Also known as electrical tape, which is a pressure-sensitive, non-conductive insulating tape useful for binding looms, cable stress-reliefs, identifying microphones, minor first aid, marking bad gear, fixing loose latches, dressing speaker stands, resealing lunch containers and holding open crash doors. Sometimes also used for insulating cable. Gaff Tape A heavy cotton tape with strong adhesive and tensile properties, used for everything else. ​ Flux Capacitor A fictitious piece of gear that the veteran stagehands will send novice stagehands in search of. Other such goose chases involve the Cable Stretcher, the Left-handed C Wrench, the Metric C Wrench and The Skyhook [editorial note: there is now such a thing as a Sky Hook] "Copy" "I'm done listening to you." "Copy that" "I'm really done listening to you now." "Roger" "Now I'm done talking to you too." "Hoooooold!!!!!!!" "Aww Shiiiiiit!" [duck & cover] Wash Up Smoke break before lunch Lunch [break] Smoke break and nap time. Coffee [break] Smoke break and a snack cuz we slept through lunch Bio [break] Chance to sneak out for a smoke before you run to the bathroom. "Make it safe" "Drop what you're doing, we're outta here!" Hollywood Half 30-min lunch period [on-the-clock] and a client-provided meal - commonly used to bribe or coerce a stagehand into staying on-site (since very few lay faith in a stagehand returning from a walk-away meal on-time). Working Lunch Some sort of sandwich, unidentifiable wrap, a slice of pizza or similar meal that may be consumed with one-hand - perfect for talent rehearsals, late-running shows, poorly planned load-ins, production schedule overruns - one of many solutions designed to avoid the fearsome 'Lunch Penalty.' Lunch Penalty A mythological creature that mommy & daddy producers tell baby producers about to frighten them into scare into eating their vegetables, making their beds and finishing their production schedules. Few stagehands claim to have ever seen any such thing. Paper Tech A production run-thru meeting that hardly anyone pays attention to. Cue-to-cue A production rehearsal where it becomes evident that no one paid attention during the Paper Tech. "Stand-by" Nap time "Standing by to stand by" Nobody has a clue what to do next. "Show Crew To Headset" "Wake up" "Client On Comm" "Client is listening, so everyone pretend that's how it's supposed to look." Well that's a wrap for today (meaning we're done). But stay tuned for Stagehand Glossary Vol 2.

Introduction As the industry starts to show signs of life, we're finding that much of our former crew was not able to hold out during the pandemic's original shut down and left the industry to take other jobs. This is forcing us to hire and train some new recruits to bolster the strength of our remaining veterans. As we continue to teach these ambitious and eager techs, we thought it might be useful to post our progress and share this with others that may be considering a career in event services. The Stagecraft Life It's true, like most specialized trades, stagehands and stagecraft professionals are members of their own unique culture, and like their vocabulary, an etiquette evolved. When we collect and present all the unique aspects of stagehand life, there is undeniably a code of ethics that we instinctively follow, or that is picked up through experience. Those recruits that resist adapting to the lifestyle don't seem to last long. Some of the rules are unspoken and some are clearly communicated. But in total, there exists a set of guidelines and principles that most production crews have instinctively adopted and standards we all seem to hold. It's worth mentioning that stagehand norms do differ based on geographic location and department specialization. But we pulled together a list of expectations and general etiquette for new recruits and good for veteran review. They may not all apply to all production crews, but they are some standards that will set you up for success, if understood and practiced. Since this is an arbitrary list, and based on only a small sampling of experience, we welcome and encourage all to comment below with anything we missed or haven’t experienced. General Expectations Stagehand's place is in the shadows. Nobody leaves until the truck is loaded. Show crew eats before strike crew. Client food is not crew food. Assume every cable is hot. Always mark your cables. Return spent lamps. Mark bad gear. Tape down cables last. Keep crew area tidy. Respond to availability checks quickly. Nobody likes a gig jumper. For freelancers, Invoices are due immediately after the show. A 10 hour day is a short day. If you're late, bring donuts. Gloves are mandatory. ​Don't get caught napping.] Advise lead if schedule will cause lunch penalty. Do not engage end-client directly unless instructed. Do not go into anyone's workbox or road case without permission. Mute your comm in the bathroom. The shift isn't over unless your lead says we're done. Don't walk away from a project until it's done. Don't talk about other jobs or clients on the job. Don't speak negatively about other stagehands. Inform your lead immediately if you break something. Empty pockets and secure tools before walking out onto a catwalk. Fill out crew paperwork before or after your shift, or during breaks or lunch. Take off your headphones while on the show floor. No unnecessary chatter over comm or radios Avoid hanging around FOH during the show, unless you're required to. Notify someone if you walk off the show floor. Take phone calls or texts at the perimeter. ​No breaks for the show crew during the show. There’s no excuse when you drop anything from a lift. Charge your lift when you're not using it and at EOD. Turn off your lift when you're done, secure the key and/or controls. Plan your bio breaks. Never nap on the stage. Label your cables. Set it like the drawing. Don't assume what's next. Slower is faster. Fix the drape behind you. Safety over convenience. Police your own gaff. If it's hard, you're doing it wrong. Bring back wayward gear. Stow empties under deads in the boneyard. Only smoke in designated areas. Don't argue with the client. Set your cell phone on “silent.” Notify crew when going off comm. Circuit exactly as instructed. Don't run or drive over cables. Attached ground, then neutral before hots Bring your own tools.​ Call ahead if you're late (late guy brings donuts) Don't miss your lobby call. Call out if you have to let a cable swing. Call out before you move a lift. Think about your install, load in for the out. Always look busy. Producer is always right (even if they aren’t) Additional Best Practices Park in designated crew areas.​ Never use an impact wrench on truss. Gaff in 90 degree angles. Reset to factory settings for fresh installs Get approvals for change orders. Do not side load shackles. Do not use unrated rigging hardware. ​Bring government issued identification Bring proof of legal right-to-work. Strain relief aerial cables. Only smoke in designated smoking areas. Latch the safety chain on your scissor lift. ​Get overtime approved in advance. Get lunch penalties approved in advance. Bring a copy of your certifications Keep fingers away from motor chains. Arrive early enough to prep and stow your gear before your call starts. Run cables over the top of truss and behind uprights, never through it. Run cables around the back of Fast Fold legs, not through them. A Shackle's pin is opposite side from the spanset, away from the fabric Notify your lead immediately if there is an injury or near-miss. Wear steel toe boots, especially when unloading a truck.

The process of booking any national headline act is complicated, therefore many national agencies only work with seasoned talent buyers. Even among professionals, they can be dismissive or rude to clients that are unfamiliar with the standard procedures. We don't share that attitude. Our business deals with a wide range of clients, from veteran producers to first time wedding planners. We're accustom to working with people at their level of experience, and helping less experienced talent buyers understand the way to accomplish their goals. This short guide is meant to give a quick outline to ensure the process runs smooth and no steps are skipped or mishandled. Although we prepared it for younger talent buyers, I'm sure even the veterans can agree, this is useful reference to use as a check list when booking a national act We receive a request from a client for various acts We research the acts, call managers, check availabilities, routing and prices (includes travel, rooms, production and hospitality as per the artists riders) We report our findings to the client and talk about the reality of booking the acts that the client has requested. This usually scales the acts down to 1, 2 or 3 options. We request complete riders from the artists We consider the venue that the client has suggested and check the feasibility of producing the act in the venue. Some acts require extensive production, staging, lighting, etc. which eliminates them from feasibility. We create an” offer" letter and submit it to the client for their signature. The offer letter includes the venue name, date, performance schedule, flight and ground travel requirements, price, accommodations, etc. In addition, we submit a feasibility study that informs the acts as to what they can reasonably expect to receive for production based on the space where the event is to be held. The client reads through this offer, signs it and faxes it back to our company. To insure that the client is committed to the artist, we require a 10% good faith deposit be wired to our client trust account along with the offer letter. If the offer is accepted, the deposit is applied to the deposit. If the offer is rejected, the deposit is returned to the promoter immediately This offer letter is then sent to the artist’s manager for their consideration. ONCE THE OFFER LETTER IS SUBMITTED, IF IT IS ACCEPTED BY THE ARTISTS MANAGER, IS CONSIDERED A FIRM AND BINDING AGREEMENT!!! Upon acceptance of the offer by the artist, a 50% total deposit is required to bind the act within 10 days of acceptance We receive the wire transfer into our client trust account and send deposits off to the artist’s agents or managers, etc. Contracts are drawn up and submitted for signature NOW THE WORK REALLY BEGINS We walk through the venue and get a final-final on the production that can be accommodated in the venue. We contract stage, sound, lighting, back line, security, generators/power, dressing room areas, hospitality & catering, etc. We book their air fares, arrange for limos and ground transportation, accommodations, etc. We set up the production on the day of the event, do the sound check and produce the entertainment portion of the event. NOTE: The artist’s fees must be paid 5 days prior to their appearance by cashier's check! This allows us time to secure payment to the artist either in cash, wire transfer or cashier's check. I hope that this helps to explain the various steps needed to provide and produce nationally known entertainment for a corporate or social event. One important thing to remember: Often times the client feels that the fees that the artist is receiving are extraordinary and the artist should be obligated to the promoter. The reality is that the artist has a career that he considers to be his most important goal. Generally, the artists have more than enough money generated from their recordings and their concerts and they do not need the corporate or social dollar. They do this as part of their commitment to their fan base and because they love to perform.

It's always fun to w atch TNG (the new guy) trying to figure out his radio. We've all seen it. The sweat beading up on his forehead as he frantically tries to figure out how to attach his biscuit, while trying to look calm and cool - as if he handles radios like this all the time. We all snicker under our breath, knowing he's never going to get that Kenwood mic onto that Motorola radio. Admit it. The only reason we take such joy in watching him suffer is, we were also there once ourselves. It's all fun and games until we're in the thick of it, and we can't find him, because we didn't take the time to teach him the fundamentals of proper radio/comm use. So I prepares a little primer on radio etiquette. Let's start with Do's & Don'ts. Do's & Don'ts DO keep chatter to a minimum. Carrying a radio is already distracting and it becomes annoying when you have to keep shifting your focus from the task in front of you to the comments on your radio. DO hold (key) your talk button for a full second before you start to speak, otherwise we lose the first part of your sentence, which is usually who you are. DO remember to return your radio to its charging station at the end of each day. DO record the serial number of your assigned radio, in case you lose it or it gets accidentally swapped DO report a missing radio as soon as you know it's missing. The chance of you finding it goes down the longer you wait and becomes almost impossible once it goes dead. DO sign out you radio with the Radio Attendant assigned to manage them. DO practice all safety protocols when using your radio while operating a life or other heavy machinery. DO NOT take someone's radio without notifying them. DO NOT change off your assigned channel without notifying your group that you're changing. DO NOT use you radio to play jokes or have inappropriate conversations. DO NOT wear your radio in a place where clothing or gear that's attached to you will accidentally key you mic. DO NOT keep your volume on high when surrounded by other's wearing radios assigned to your group. DO lower your volume if radios around you start to cause feedback. DO NOT bring your own radio, especially on larger shows, without checking with the RF tech to make sure you're not using a frequency that's been isolated for another purpose or may cause issues with other RF systems. DO NOT scream into your mic. ​DO NOT whisper into your mic Vocabulary Mic Speaker mic attachment that is commonly attached to shoulder panels, collars, front pockets or other spot convenient for monitoring the small "biscuit-shaped" mic handset. In-Ear "Secret Service" Mic The in-ear Surveillance Mic attachment with the mic button on a separate cable to be run down sleeve and attached inside your shirt cuff. Handle A moniker such as nickname, department or other designation you may take or might be assigned to you. 10-4 Message acknowledged Affirmative Yes Negative No Over Finished talking and listening for reply - short for "oiver to you" "Out" Finished talking and do not expect a reply. Clear Finished talking and shutting radio off Roger Information received/understood Copy Mostly used to acknowledge received information. Wilco Will comply Break Signals a pause during a long transmission to open the channel for other transmissions, especially for allowing any potential emergency traffic to get through. Break-Break Signals to all listeners on the frequency, the message to follow is priority. Common Terms "Radio Check" Common phrased to test the functionality of the radio, proper channel assignment and volume level. "Good Check" The common reply over the radio from someone monitoring the same channel, indicating that you came in clearly. Replace "good" with the condition of their transmission as necessary. "[your handle] for [recipient's handle]" It's customary to engage your recipient before just speaking. Key your radio [hold a second] and say your name "for" and who you want to connect with. You will wait for them to say... "Go ahead" or "Go for [handle]" Send your transmission. "Say Again" Abbr: Repeat Your last transmission - "repeat" is a reserved word used by military "Going to [channel]" First allow me to explain, on any given show, there can be anywhere between 10-100 radios assigned and actively in use. As I explain in greater detail elsewhere, the need to separate groups, usually by department or function, controls the amount of chatter and distraction. But often, you or someone you need to reach may have to leave the channel your group has been assigned. Informing your group that you're leaving your channel helps to avoid confusion. "Going back to [channel]" When you're done communicating with the person in the foreign channel, it's customary to tell the group that you're going back to your assigned channel, in case they need you for a follow up, etc. "This is [your name or handle]. Back on [channel]" Once you've returned to your assigned channel, let your group now with this simple notification. "What's your '20?" Based on 10-codes, 20 is short for 10-20 and this means "what's your location?" "Anyone have eyes on [person]?" When someone has put there radio down, or moved to a different channel, an effective way to try and reestablish contact is make a general inquiry to all monitoring that channel if they see the person you're asking for. If someone does, it is customary for that person to notify your intended person. "Go to (spare) [channel]" If your conversation is more than a simple inquiry or command, unless you're communicating something the whole group needs to hear, there are typically spare channels designated for short, but distraction-free communication. Inform your party to change to a spare channel so you can speak freely without clogging up the line. Be wise. Although spares are meant for more private conversations, they are not exclusive and it's always possible someone may be listening in on your conversation. "Go off Radio (Comm)" It's customary to tell your group you're turning off your radio, or will be unavailable by radio for some period of time. ​Keep in mind, etiquette varies from crew to crew and from region to region. This wasn't meant to be an exhaustive study by any means. But if I omitted something you think is especially important, please add to it in the comments section below. Thanks it for now. Going off comm.

When you get to the 'dance,' you ought to 'dance' with the one that brought you. What is Circumvention? Circumvention (To circumvent) results from [1] a freelance contractor or white-label supplier's intentional or unintentional action of bypassing his contracting client, and directly engaging or soliciting the end-client for the purpose of securing employment; [2] or allowing the end-client to bypass his supplier for the purpose of soliciting the freelance contractor's services directly, thereby "circumventing the individual or company that facilitated the opportunity. So What Does That Mean? When an AVL technician, engineer or other stagecraft professional is hired by a third party, such as staffing agency, and introduced to an employer like a production company, who then purposefully and deceptively solicits the production company for work, with the intention of avoiding or circumventing the staffing agency jobs, all of which is unknown to the staffing agent. Likewise, when the employer such as a production company uses contact info provided by the staffing agency to solicit the stagecraft professional directly, with the purposeful and deceitful intention of offering the stagehand work as a freelancer without the staffing agency's knowledge or consent. What's Wrong With That? Although the practice of circumventing one's client has been around for as long as there have been sales agents or agencies to broker goods and services, in the production management and event crewing business, we’ve noticed the trend has grown sharply in recent years. We've also witnessed an apparent negative impact for all stakeholders involved, not just the broker or agent. Frankly, it's gotten so prevalent and widespread that some aren't even denying or disguising their actions, as has been done in the past. Therefore, we wanted to share a little insight into what the behaviors do to the stakeholders involved and why this behavior has a long term negative effect on the individuals, the companies and the industry itself. Circumventing one's client and going directly to his client is widely considered unethical in most industries. Now, this shouldn't be confused with Non-Competes, whereas Circumvention is more about the improper use of trade secrets while actively employed. I'm personally not a fan of Non-Competes because I believe healthy competition is vital to the health industry. But absconding with a client's hard-earned lead is not competition. Most would consider it theft. Certainly, there are reasons to go around or go direct, such as the broker has acted in bad faith or illegally. But legitimate reasons are specific and do not lend to the negative impact on morale or quality of service that overt circumvention can have. For the most part, the overall event production community, and the companies that hire crew through crewing companies understand and respect the industry ethics surrounding their relationship with each other, as well as their union brothers. Sadly, sometimes an innocent stagehand can be adversely affected if the hiring company puts pressure on them, while they are trying to be noble. The crewperson may actually run the risk of losing the client either way [through the labor company and direct]. In short, it’s understood that stagehands are expected to protect the relationship between the end-client [the hiring company also referred to as Employers] and the contractor's client [the staffing agency, broker, labor company or independent labor coordinator]. Important to note: The Employer is NOT the contractor's client. The contractor's client is the staffing company or entity that booked him on the gig. That end-client/employer is that company's client, regardless of whether it's a new opportunity or a long-time relationship. The introduction and meeting were facilitated by the company and the contractor would not have the relationship had it not been facilitated by the company. Still Doesn't Make Sense? Imagine when we were kids, and we're all out on the playground, and you just happen to be an amazing friend that was generous and selfless in giving. You liked to see your friends happy, so every day you brought some brand new toy, never been touched, nothing broke off, everything perfect. And there was this one kid that every day, he would take the toy, push you down, and walk away laughing. But you being the amazing you that you are, keep bringing a new toy, every day, believing that the other boy must realize by now that his actions were selfish and destructive. He must see the folly of his ways now. This time, maybe he'll bring some of his toys, and we'll build a toy empire... But every day is much like the last one. The new toy is stripped away, you are pushed to the ground, your friends won't help you out and instead just laugh at you while, astonishingly enough, play with the other kid and with your toys. You may think this scenario is a bit far fetched or not aligned. Well, consider, just our company spent thousands on recruiting and onboarding last year and tripled that on marketing last year. Add to it the investment in Operations and even Service Recovery. With all that investment, as well as the time spent, the resources allocated, well certainly we earned the right to monetize the relationships. So wouldn't it be unjust for a client to hire our company just long enough to engage our crew, in turn saving himself the time, money and resources necessary to recruit, vet, onboard, train, solicit and bring into compliance? Just another story of a schoolyard bully. So You Don't Trust Your Crew? No, not at all. As I stated earlier, most understand the ethics and compliance. And not all direct hires are considered circumvention. On occasion, the chemistry between a technician and hiring company is so strong that the hiring company may desire to add them to their regular staff. At that point, the etiquette generally is that the hiring company will approach the crewing company and announce their intention to hire the technician as a regular employee, an action the crewing company does not discourage. In fact, it’s always an honor, as it’s a reflection of the respect that the hiring company has for its crew. For us, it’s always a happy moment when we get to call the crew member and tell them about the offer. How Does It Negatively Impact Stakeholders? So I'll assume you accept that the practice is unacceptable for the time being, and move on. Admittedly, if the only negative effects on the industry were those born by the third party, I'd probably avoid writing this. In fact, to avoid sounding like a whiner, I have avoided writing this for some time now. But with recent changes to legislation and the increasingly watchful eye of regulators and revenue agencies, it's important that every side understands how they are possibly influencing the future. Negative Impact On Crewing Companies Every year, crewing companies invest a great deal of time and resources into the overall commercial operations of the company. A significant portion of the earned revenue is paid directly to the crew members working on the jobs. Another large portion is withheld for applicable taxes and a portion is set aside for employer taxes, as required. From the remaining balance, the gross profit, that revenue is used to support business costs including office staff salaries, lease and utilities, and other operating expenses. It also supports our marketing expenses, cost of sales, expendables & consumables, recruiting efforts, sales expenses, and insurance premiums. Add to that the rising costs associated with regulatory and legal compliance and the rest of the various taxes, licenses, and permits. The net profit from furnishing freelance or temporary employees as a service is not as much as some might believe. That doesn't include mistakes in payables or receivables or the cost of service recovery when tech fails to deliver and we have to refund a client yet still bear the cost of labor. Therefore, we depend on the revenue that we earn from our clients, to cover the projected expenses and manage the cash flow. For each technician or engineer we have on our roster, there is a cost associated with their marketing and soliciting them, and we expect to be able to recoup that investment. Even more so when our investment is what provided that crew member to hone their skills, to begin with. Many times, we'll get a stagehand when they are still green. By the time they learned enough and have the experience to charge higher rates, we've invested quite a bit into them and looking forward to reaping the reward with them. These are among the primary ways that circumvention impacts labor companies' inability to effectively monetize its investment. The Net Effect Next, we share some of the direct and indirect impacts on stagehands and employers. Crew Morale Morale is always impacted when a community is given a set of rules and sees a smaller group openly defy those rules without noticeable repercussions. As they start to feel slighted or unbalanced, it will result in a further degrading of your reputation, the fueling of the surreptitious rumor mill and possibly even a bit of a revolt if more stagehands follow suit. The end result will be a crew that constantly eyes each other with suspicion on both sides of the tech table. Reputation It doesn't take long to earn a reputation for being one that goes around your contact to go direct. It's a small industry and we all seem to know each other or of each other. And today's communication makes booking labor nationally even easier. Once you start going around your client's back - directly to their clients, you'll find that other clients and even stagehands will hesitate to trust you with their clients. Rising Costs As discussed, the cost of recruiting, operations, sales, marketing, accounting, and compliance are fixed costs and a large percentage of the annual earnings. Therefore, when sales are impacted and we lose revenue, our only recourse is to raise prices, but not necessarily in line with increased service. When prices exceed the equilibrium point of what the market will bear, we start to lose more sales and the price to value ratio tips beyond our ability to stabilize the business. End of story. Lower Rates & Benefits Okay, the same scenario, but we don't want to give up without a fight. Since we can't raise prices, but we're still not profitable, our only other recourse is to cut costs. Since prices are still at the top of its equilibrium point, we can't cut services without pushback from the client, so we have to cut crew rates, the single largest line item in the budget. Now we're offering lower rates, with cranky and untrusting clients. And we're back to poor morale - and eventually.,.. yes, you guessed it... End of story. Future Opportunity But long before those two scenarios play through, the first thing you'll feel is fewer jobs and the jobs you are offered aren't the premium ones. Now, you might say, "Hey, don't punish me. I stayed loyal.' Yes, perhaps that's true, but it's not personal. You're getting crappier jobs and less of them because there just aren't any jobs to offer you. Your client stealing colleagues tied those up. At this point, who cares about Karma and the fact that you did it all right. You're broke, you're having a hard time finding legitimate work and not it's End of story for you. So How Does This Affect The Industry Okay, admittedly those are extreme scenarios but don't be fooled. They are very realistic. But I know what you're thinking, "Maybe crewing companies are a thing of the past and this is Darwinism eating up the weak?" Yeah...not quite. What we haven't discussed yet is the legality of what these wayward colleagues are doing. Right now, in the US, and especially in California, legal battles are being fought that will change the face of how we crew shows. Regardless of the direction these battles fall, the process is already in motion as a regulating and revenue agencies all try to assert their standards and muddy the waters. In the end, no matter how we are classified, legislation is going through that will make crewing companies more important than ever. Frankly, many of our California production company brothers are breaking the law every day with their hiring practices and payments to stagehands. Don't believe me, research for yourself about independent contractor compliance and you'll be shocked to find out that even the most legitimate independent contractor, the high-value V1's, L1s and A1s cannot be hired in California legally without following California's Wage Orders, addressing the length of your workday, overtime, meals and breaks, and even reimbursable expenses. They also don't realize that if they hire an IC that doesn't have workers comp insurance, even if they are sole proprietors and exempt from having to cover themselves, the employer must list them on their policy and pay the appropriate percentage of their earnings - and if they don't, then liability can be extended to the end-client. Confused? But this is what we do and why you might not think we earn our paychecks, sitting in our soft chairs with a clean shirt on. But labor coordinators and crewing specialists have a hard job - that's getting guys to work - facing clients that prefer not to pay legit rates, while you guys bitch and whine. We have to hear it from both sides. But hey, we love the guys, and that's why we do it. As I hope you realize now... We certainly aren't getting rich from it. I hope you'll have a better understanding of why we make you sign Non-Circumvent Agreements and why we're forced to enforce them. We're just trying to keep everyone happy and well-fed. # # # # For additional information or question, you may contact: Brandon Cruz brandon@cruz-xp.com Please note, this article was produced as informative and should not be used for the purpose of determining compliance or basis for legal action or response. If you have a legal or tax question, you should consult a licensed attorney or certified public accounting professional. California Supreme Court Decision: Dynamex West v. S.C. (Lee) US Dept of Labor: Misclassification of Labor US 11th Circuit Coard Ruling: Crew One Workers Compensation Requirement California Wage Orders Determining Employee Status The Real Cost of Labor

WASHINGTON, DC – The U.S. Department of Labor today announced the publication of Unemployment Insurance Program Letter 14-20 (UIPL) outlining relevant provisions of the Coronavirus Aid, Relief and Economic Security (CARES) Act related to the administration of and eligibility criteria for state unemployment insurance (UI) programs, including Pandemic Unemployment Assistance (PUA) for those not typically eligible for UI, such as gig workers, and expanded UI benefits. Today’s guidance is the first of several upcoming UIPLs to states on the unemployment insurance provisions of the CARES Act. The CARES Act follows decisive and timely actions already taken by the department, Congress and President Trump to provide American families with much-need relief during the COVID-19 crisis. “As workers across the country make sacrifices to combat the coronavirus, the U.S. Department of Labor is focused on supporting them and their families during a time of economic hardship,” said Secretary of Labor Eugene Scalia. “The Department is offering guidance and support so that States can provide benefits quickly while protecting the integrity of the unemployment insurance system.” The UIPL outlines several new programs under the recent CARES Act. PUA provides benefits for eligible individuals who are self-employed, seeking part-time employment, or who otherwise would not qualify for UI benefits under state or federal law. To be eligible, among other requirements, individuals must demonstrate that they are otherwise able to work and available for work within the meaning of applicable state law, except that they are unemployed, partially unemployed, or unable or unavailable to work because of COVID-19 related reasons. Under the Federal Pandemic Unemployment Compensation (FPUC) program, eligible individuals who are collecting certain UI benefits, including regular unemployment compensation, will receive an additional $600 in federal benefits per week for weeks of unemployment ending on or before July 31, 2020. Additionally, the Pandemic Emergency Unemployment Compensation (PEUC) program allows those who have exhausted benefits under regular unemployment compensation or other programs to receive up to 13 weeks of additional benefits. States must offer flexibility in meeting PEUC eligibility requirements related to “actively seeking work” if an applicant’s ability to do so is impacted by COVID-19. For more information UIPLs or previous guidance, please visit: wdr.doleta.gov/directives/ For department resources on COVID-19, please visit: www.dol.gov/coronavirus For more information about COVID-19, please visit: www.cdc.gov/coronavirus/2019-ncov/ The Employment and Training Administration administers federal job training and dislocated worker programs, federal grants to states for public employment service programs, and unemployment insurance benefits. These services are primarily provided through state and local workforce development systems. The mission of the department is to foster, promote and develop the welfare of the wage earners, job seekers and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights. Agency Employment and Training Administration Date: April 2, 2020 Release Number: 20-492-NAT Contact: Department of Labor National Contact Center Email: DOL-Info@dol.gov Copyright © US Dept of Labor | Republished with permission

It's been a while since we added to the Production Glossary. Since we've been doing a lot more camera work than we typically do, it's appropriate that this vocabulary update is focused on Camera. Comment below if we missed any common terms. We'd love your feedback. Camera Operator Direction Ready Next camera to be cut (live) to program out Standby Next camera to be dissolved (live) to program out Take/Cut Ready camera is quickly cut to program out (eg. Cut 1) Dissolve/Mix Standby camera is slowly dissolved to program out (eg. Dissolve 2) Camera Movements Hold ​Stop camera movement (hold current shot) Reset Return to previous position (starting point) Start Begin prescribed movement (eg. start push) Pan Right Move camera lens right Pan Left Move camera lens left Tilt Up Move camera lens up Tilt Down Move camera lens down Zoom In Tighten camera framing Zoom Out Loosen camera framing Tighten Up ​Zoom in slightly to tighten camera framing Loosen Up Zoom out slightly to loosen camera framing Push In Zoom in slowly on subject Pull Out ​Zoom out slowly from subject Push [Subject] Right Slowly move subject to right side/edge of frame Push [Subject] Left Slowly move subject to left side/edge of frame Push [Subject] Center Slowly move subject to center of frame Lose [Subject] Right ​Slowly lose subject off right side/edge of frame Lose [Subject] Left Slowly lose subject off left side/edge of frame Reveal [Subject] Right Slowly reveal subject on the right side/edge of frame Reveal [Subject] Left Slowly reveal subject on the left side/edge of frame Static Shot A non-moving/still shot Composition/Framing Full Wide Zoom out as wide as possible Stage Wide Zoom out to frame complete stage Head To Toe Framing of subject from head to toe Knees Up Framing of subject from just below the knees to top of head Inseam Up Framing of subject from just below the inseam to top of head Waist Up Framing of subject from just below belt or waistline to top of head Elbows Up Framing of subject from just below the elbows to top of head Bust Shot Framing of subject from just below the shoulders to the top of head Head Shot Framing of subject from just above the shoulders to top of head 1-Shot Framing of one subject (typically from the waist up) 2-Shot Framing of two subjects 3-Shot Framing of three subjects Frame [Subject] Left Framing of subject in the left side of screen Frame [Subject] Right Framing of subject in the right side of screen Center Up Framing of subject in the center of screen Establishing Shot Geography, environment, landscape or structure, etc to establish location Camera Mechanisms Sticks / Tripod Used for static shots and simple pans and tilts Slider Shot Slide camera on a vertical or horizontal axis Handheld Shot Held by operator, no mechanical stabilization Steadicam Shot Camera stabilizing device that attaches to the camera operator Gimbal Shot Device that use motorized gyroscopes to reduce friction that fits in small spaces Crane Shot Robotic arm used to sweep up and over a scene Jib Shot Manually-controlled arm, similar to Crane, but with limited range and movement Drone Shot Camera mounted to a drone and controlled by RF Wire Shot Camera rides on a cable or wire for deliberate, smooth move Miscellaneous Terms Check Focus Image is out of focus and needs to be sharpened up Check Iris [Dark/Hot] Image is either too dark or too bright (adjust f-stop/iris) Headroom [More/Less] Framing above the subjects head (too little or too great) Lead-Room Open space in front of subject (when facing/walking left or right) Rack Focus Change in focal point from one subject to another or to roll out of focus Snap Zoom Quick zoom in & out on subject (by manual control of focal ring) Preview Camera which is next (ready/standing by) to go live Program/Program Out Camera which is live

Any business owner with one or more employee knows this to be true... the cost of labor can be stifling, especially in states with high minimum wages, mandatory benefits, and strict definitions of 'who is a contractor.' Less talked about are the indirect costs of labor, which can go so far out of control, that many employers and contractors are overwhelmed by the challenges they face. We publish this article to more completely explain the actual costs that are involved in maintaining a full-time, part-time, and contingent workforce, the direct costs such as payroll, employer taxes, benefits, and insurance to indirect costs such as processing expenses, operating costs, invoice exceptions, and time-theft. We'll touch on the pros and cons of using an independent payroll service, managing a contingent workforce, and the increased regulatory compliance. In the end, any average company will have the resources to analyze the cost to benefit when deciding their optimal workforce mix. NOTE: As you read on, be mindful that all companies, and even entire industries, will have major and subtle differences in their business model, culture, and/or vision statement - all of which can influence or adversely impact the cost factors described below. Equally important to consider, some organizations will have a higher tolerance for risk, reside in states with more or less regulation, are subject to more or less oversight, or simply have a shallow talent pool - but for the most part, this article applies to a broad range of California employers, from any industry, and does not pertain strictly to the live event industry. Finally, as we reread this article, we realize that many companies have labor only as a cost to the business, whereas most service-based companies see labor as a profit center, as well as a cost center. This piece is written from the later POV. Direct Costs Direct Costs are all expenses directly connected or associated with the wages earned by an employee or contractor. They are the most common costs that come to mind when you think of the Cost of Labor, such as wages, taxes, benefits, and liabilities. Payroll Expenses Employee Payroll / Contractor Fee: This is the sum amount of the monies owed to the employee or contractor. This can be an hourly-rate, day-rate or flat rate - although some rules must be followed when calculating flat-rates to ensure that regardless of the agreement, the amount paid is higher than the applicable minimum wage. Employer Payroll Tax: This includes the employer contribution for federal, state, and local taxes and government insurance, such as Medical and Unemployment. The employer contributions for Federal include Social Security (6.2%), FICA (1.45%), FUTA (0.6%), and in California, the SUTA for new employers (3.4% for new California employers), plus any local or municipal taxes. Non-Billable Expenses: When parking, bridge tolls, hotel room nights, meals, and other job-related expenses cannot be billed back to the client, those costs must be accounted for and are often charged against the job. They include any expenses or other incurred costs by company personnel at, on the way to, or on the way back from the job site, including transportation costs, drayage, transfer fees, equipment rentals, and expendables, etc. General Liability Insurance: A policy limiting your company’s liability for claims made resulting from an accident caused by one of your employees. In some cases, you can request freelance contractors indemnify you and name you as Additional Insured on a policy they may carry. But less established techs rarely carry their own liability and therefore must be covered under yours, as necessary. And employees are automatically indemnified by their employer, except in cases where the employee acted in a fraudulent manner or in violation of applicable laws without employer knowledge. Workers Comp Insurance: Insurance providing disability benefits as wage replacement and medical care and benefits to employees injured in the course of employment in exchange for relinquishment of their right to sue your company for negligence. This insurance is mandatory for all employees, whether part-time or temporary - and if your contractors fail to provide their own worker's comp insurance, for many jobs the contractor must be covered by your company’s policy. Failure to do so could result in the contractor filing a claim against your end-client’s policy - which won’t go over too well with most end-clients. Commercial Auto Insurance: If you’re going to have a contractor or an employee drive vehicles, like trucks, cargo vans, passenger vans or even their own vehicle to run and pick up supplies, commercial auto insurance provides protection from liability, injury or collision damage if they get into an accident. And be careful to read the fine print on your rental truck agency agreements. It’s a misperception that your personal auto insurance will cover your rental van. Where they may be true as you drive it away from the lot, the moment you put people or gear in it that’s work-related, most policies won’t cover an accident or the costs of collision damage, theft, property loss, personal injury, medical expenses or possible punitive damages. Processing Expenses Merchant Processing Service Fees Cost for processing a credit card payment which will vary by company based on volume, risk, and credit rating. Fees can be as low as 1% or as high as 5%, but the average for small business that accepts payments by phone or thru companies like Paypal, the average is a base rate of approx. $1, plus 3% of the sale. Invoice/Payroll Processing It takes time and resources to process an invoice and payroll for payment. It might seem simple enough. Print it, pay it. But there is a process that must be followed to allow for adequate tracking and audit, including verification of the hours, accounting entries, client approvals, and the resources to complete, run and file the payment. On average the all-inclusive cost to manually process a single invoice can range from $12 to as high as $40 per invoice. Invoice Payment Transaction Fees Our normal process to pay invoices is a company check mailed on Fridays for invoices received by EOD Tuesday. However, as a consideration for our crew, we have paid using Venmo, Paypal, Western Union, and several other systems. Most charge a transaction fee, ranging from a couple dollars to a percentage of the transaction total. Invoice Exceptions Expenses Since time cards or contractor invoices often do not match up with employer-provided timesheets, extra time must be devoted to researching and investigating Exception invoices. This sub-process takes that invoice out of the queue for processing until it can be handled individually and adds additional days and associated costs to its processing. In many cases, invoice exceptions do not represent a minority of transactions but can range between 50-70% of a given job. Indirect Costs Indirect Costs are those expenses that are incurred in the process of recruiting, onboarding, training, soliciting, scheduling, managing, paying, and terminating an employee through the cycle of their employment. Also underestimated, these costs may also include hard and soft costs associated with loss of opportunities or revenue, such as court and legal fees, collection costs, disability/unemployment claims, penalties & fines, adverse decisions & punitive actions, as well as the loss of clients or liabilities surrounding employee fraud or negligence. Cost of Job/Sale This list includes the additional costs associated with each sale. Some of the lines include ambiguous references to company personnel. It’s important to remember, like the staff required to process an invoice, there are other costs associated with making the job happen, such as: making the job possible, ensuring we have the means to fulfill it, promoting our ability to do the job. Similar to operating expenses (which we describe below), the lines here should be summed up and divided by the total number of jobs. That remaining value is the sum total of all the indirect resources that are required to make the job even possible. Materials: The cost of any materials or supplies used in the execution of the job. This can be as simple as file folders & labels and paper & ink, but might also include specialized gear and expendables such as custom tool kits, specialized electronics, personal protection equipment, personal hydration devices, and first aid supplies. Human Resources Administration: The cost of the administration staff required to manage the day-to-day administration of the company, from corporate governance and compliance audit to management of Human Resources and Finance. Recruiting & Onboarding: Cost associated with providing specialized personnel to solicit, recruit and interview new candidates; then guiding successful candidates through the Onboarding and orientation meetings or webcasts Training & Management: Costs associated with providing specialized personnel to perform training and workshops, as well as costs required to provide effective and efficient management. Marketing & Marketing Operations: Costs associated with compelling clients to buy. These costs including demand generation, lead nurturing, advertising, promotion, and sponsorship - as well as the systems and processes required to ensure there are accurate and effective. Sales & Sales Operations: Costs associated with capturing the sale and fulfilling the order. These costs include commuting and travel to and from job sites, potential lost opportunity, business development, account management, materials, and collateral, etc - as well as the systems and process required to control spending and record accurate and profitable transactions. Operating Expenses The following list includes the various costs incurred to operate the business on a day-to-day business. The gross profit from the cumulative sum of all the jobs must cover these basic operating expenses or the business will be in the red at the end of the year. Therefore the operating budget per job would be the total annual operating budget divided by the total number of jobs for the year. That dollar amount is the average that all the jobs must clear, on top of all the expenses listed above. This is just a sample list, and not exhaustive - but you get the picture: Office Salaries: Office personnel including Labor Coordinator, Accountant, Office Manager, Sales & Marketing personnel, Operations & Production personnel Office Wages: Includes any non-salaried positions including admin assistants and clerical staff Office Lease & Utilities: Includes office lease, warehouse lease, building improvements, as well as gas, electric, water, and garbage. Telecom: Includes landline, toll-free, fax, and mobile numbers - and may also classify high-speed internet and digital cable. Professional Fees: CPAs and bookkeepers fee for managing books, preparing and filing taxes, performing audit review, and representing a taxpayer during an audit, as required. Lawyer(s) for contract review, document prep/review, negotiation, litigation, litigation defense, trademark/copyright protection, infringement, legal complaints or responses, and other related actions. Supplementary Insurance: Umbrella Liability, Errors & Omission, Equipment Damage or Replacement, Medical, Dental, and Vision, etc. Office Furnishings: Even a home office or satellite office requires a desk, table, chair, lamp, filing cabinet, computers, and printer. Office Supplies: Business requires basic expendables to function, such as paper, pens, folders, paper clips, labels, envelopes, desk organizers, toilet paper Recurring Fees Trade Membership Fees: Professional trade organizations, industry associations, networking organizations, community engagement programs Vehicle Registration: State vehicle registration, commercial vehicle registration, operating weight decals, annual registration tags, motor carrier permit Software Licenses: Network Administration, Accounting, Office Applications, Webcast, Project Management, Customer Relationship Management (CRM), Marketing Automation, Sales Operation, Graphic Design, Document Portability, Digital Signatures, Monthly Bank Fees: Service Fees for one or more checking account maintained by the business, such as Operating Account, Payroll Account, Escrow Account, and Tax Savings Account Loan Interest: Interest paid monthly on a business loan, company credit card, line of credit, or other unsecured credit accounts. Municipal Tax, Licenses & Permits: City Business Tax License, Reseller Permit / Resale License, EDD Insurance State Tax Prep & Corporate Filing Fees: Articles of Incorporation, Company Bylaws, Board Meetings & Minutes, Income Tax Prep & Filing Fees: Annual Tax Forms, Schedules, Worksheets, Quarterly Payments, and other filings. Lost Revenue/Opportunity Don't underestimate the value of revenue lost from a missed opportunity. We may not notice the jobs we don't get if we weren't called for them. That's among the reasons cash flow analysis, profit & loss statements, comp analysis, and inventory value reports are necessary to identify adverse patterns. Service Recovery: Discounts or refunds returned or credited to clients due to poor or substandard performance of the part of an employee or contractor that is deemed unacceptable and therefore not collectible - not is it recoverable or reimbursed by the employee or contractor. Bad Debt: Any sum of money unpaid on the invoice(s) due that are deemed unrecoverable, typically the result of client financial troubles, poor service recovery, lack of proper record-keeping, or degraded client relations. Late Payments: Cost associated with receiving payments late. This can include interest paid on short term loans or amounts balanced on credit cards requiring an additional service charge and/or interest charge. Lost Sales Opportunity: The happens for many reasons, including problems with crew or crew chemistry, poor performance, poor communication, or poor business process. When calculating the value of a lost opportunity, don’t measure just the lost future sales projections. Try to measure and quantify the cost invested in acquiring the client from the beginning. This is a pretty comprehensive list of everything that goes into hiring and managing a production management staff and/or event production crew - however, it’s not an exhaustive list, since as mentioned earlier, these account for the basics of the business. Be sure to consult with a professional that understands your business and the laws of your state before edit your existing process based on what you learned here. Let’s demonstrate an example of the True [Real] Cost of Labor is, factoring in some of the variables discussed above. To make this exercise easy to follow along, we’ll use some round numbers and some values from my previous company. This is based on a small company that does an average of $350k in net sales and $210k in payroll expenses. It’s also based on a new employer paying into Unemployment insurance and a Workers Comp rate of $0.08 per $1.00 of pay. This does not compute all the lines we reference above, but granted, it’s a small company. The data represent a real-life scenario, but there are so many factors that contribute to the top and bottom line, that hopefully this simply makes you aware of the factors that not only labor companies face - but yourself face them. I’m actually surprised how many small companies are facing them, and don’t even realize it. Forgive us for the length. There was a lot to cover… # # # # For more information about our rate structure or questions about the topics discussed above, please contact us at info@crusolution.com. Important Notice: This article is an opinion editorial and not intended for use to determine your company's legal or regulatory compliance. This is not a legal publication so it can aid in your research and understanding, but it is shall not be construed or regarded as legal advice or instruction. Before taking any action, based on what you've read in this article, be sure to consult with your lawyer and/or accounting professional - or appropriately licensed professionals familiar with the laws of your country, state, or municipality.