Residuals Use Fees
About Residual and Use Fee Distributions
The Union of B.C. Performers is responsible for the administration of use fees for film and television productions produced under UBCP/ACTRA collective agreements.
Residual and other use payments are governed by the B.C. Master Production Agreement (BCMPA). All performers in residual-attracting categories are entitled to payments for the continued use of the production. Residual-attracting categories include Principal Actors, Actors, Stunt Performers, Dancers, etc. – all categories except Background Performers and Vocal/Dialogue Coaches.
Is this your Money
If we can’t find you we can’t send you your money! Please check the search engine located at the bottom of this page (Performer Search) to see whether we are holding your residual cheque. If you find your name, please contact Kaayla Kenna at (604) 689-0727, extension 2262 or by e-mail at firstname.lastname@example.org. She will be happy to update your contact information and arrange for payment to be made.
Use Fees for any shows produced under ACTRA collective agreements (in the rest of Canada) are administered by ACTRA Performers Rights Society (PRS) in Toronto.
UNDERSTANDING USE FEE PAYMENTS
There are three options available to producers when it comes to paying use fees to performers:
- Prepayment Option
- Advance Option
- Individual Use Option
The producer must choose the same use option for all performers on UBCP contracts for a given show. The use payment chosen by the producer must be indicated on the performer’s individual performer contract, in the section entitled “Additional Release Rights”.
Other than the initial prepayment or advance, which are paid at the time of production along with regular work fees, the length of time it takes to receive the first use fees payment from a company varies. In some cases, it will be a few months after the claim letter is filed. In others, it involves a significant amount of detective work to track down which company is responsible for the residual payments to performers.
This is by far the most common use option chosen by producers. With the prepayment option, the producer “prepays” use fees for certain markets and media for a set length of time based on a percentage of the performer’s Net Fees. Under the BCMPA, these percentages are 130% for feature films and 105% for all other types of production. The time frame is four years for Features, Free TV Movies & Mini-Series, Direct-to-Video and Pay TV projects. For Free TV Series and Cable TV productions, the prepayment period is five years.
Under the terms of the BCMPA, if a company continues to exploit the production after the expiration of the prepayment period, then use fees are payable to the performers based on a percentage of Distributors Gross Revenue (DGR). In general, the Union receives 3.6% of DGR from the company as residuals for all performers who worked on UBCP contracts for the show, along with fringes for Insurance and Retirement payments. If some performers on the show were working under Screen Actors Guild (SAG) terms and conditions, then the 3.6% may be prorated between UBCP and SAG.
After the Union receives the cheque from the company, the Union divides up the payment amongst the performers in residual-attracting categories based on the unit’s formula in the collective agreement. Performers who have higher gross fees at the time of production will have more units for use fees, up to a cap of 20 units per individual performer for each production or episode.
Another option available to producers for some types of production is to renew the prepayment period for another four or five year period. This is quite rare and is typically only done with very successful show like “The X-Files”. In this case, the company generally issues a cheque to each performer for the amount of the prepayment percentage. The Union ensures the payments are correct and mails the cheques out to the performers.
With the Advance Option, the producer pays a percentage of Net Fees as a non-refundable advance against a set percentage of Distributors’ Gross Revenue. For example, the producer might pay 50% of Net Fees against 5.6% of DGR. When an Advance Option is chosen, there is no set time frame before additional use fees are owed. It all depends when the company recoups what we call the Aggregate Advance. To determine the Aggregate Advance, the company has to total the amount of the Advance paid to each performer on the production. Say the Aggregate Advance is $100,000 CDN. In our example, when 5.6% of DGR reaches $100,000, monies are owed to the performers on any additional DGR received by the company. Obviously, a hit show is likely to recoup the advance more quickly than a show that is less successful.
Again, the Union receives a lump sum amount to divide up amongst the performers using the unit formula. Note that there are also caps provided for in the collective agreement to prevent the Aggregate Advance from being so huge that the company will never recoup it, which would enable them to avoid paying further use fees to performers.
Individual Use Option
This option has only been accessed by the producers a handful of times over the history of UBCP. Under this option, there is no use fee payment to performers at the time of production. Instead, the company pays a percentage of Net Fees to each performer based on the media and markets where the production is exploited. The Union also administers these payments. Unlike the Prepayment and Advance Options, there is no unit calculation required for the Individual Use Option, so the amount earned in residuals for each performer is not affected by the size of the cast or the earnings of other performers. Instead, it is strictly based on the Net Fee of each individual performer.
DETERMINING UNITS FOR USE FEES UNDER THE ADVANCE AND PREPAYMENT OPTION
Each Performer’s use fee payment is calculated by UBCP on a production by production basis. Once a Producer or Distributor remits 3.6% of their Distributors’ Gross Revenue, each Performer will receive a use fee payment based on the following formula:
- Each Performer’s gross fee earned for the production is divided by the minimum “actor” daily rate for the production. This will determine the number of units assigned to each performer. Each performer is allotted a maximum cap of 20 units per production/episode.
- Adding the number of units allocated to each Performer in residual-attracting categories will determine the total number of units for the production.
- Each Performer’s individual units are then divided by the total number of units for the production to determine the percentage of the company’s use fee payment that each Performer should receive.
- Multiplying the company’s use fee payment by the percentage that each Performer is entitled to will determine each Performer’s gross use fee earned for the production.
The above formula ensures that the use fee each Performer receives is a reflection of the Performer’s original payment on the production. Each Performer’s gross fees are verified against the original payroll remittance forms to ensure accuracy. Use fees will vary depending on the amount of Distributors’ Gross Revenue earned on the Production and the percentage applied to it, the number of Performers in residual-attracting categories on the production that will be sharing in company’s use fee payment, and the gross fees that each Performer earned on the production. Simply put, there are several factors which influence the use fee each Performer will receive and no two productions are alike.
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