Understanding Modeling Contracts

Congratulations—you were offered a modeling contract! Now don’t sign it, and hire a lawyer.

Understanding modeling contracts requires an understanding of contract law, labor law, and industry practice. Modeling agencies—or “management companies,” as they call themselves— must write their contracts in a certain way so as to not run afoul of labor laws. Standard modeling industry practice, however, may not always align with what is written in a representation contract.

There are four primary points that all models should understand about modeling contracts.

1) Agent versus manager

First, your management company will likely act like an agent but call themselves a manager. What is the significance of this terminology?

In California, for example, where the acting industry is largely based, there are laws restricting talent managers from “procuring work,” (e.g., submitting talent to jobs) without a license to do so. Talent agents are permitted to procure work for their talent because they are licensed—and their commission is capped at 10%.

Managers do not have a commission cap and are not required to be licensed. New York labor laws regulating agents and managers are similar but slightly less strict than California laws. There are no specific laws aimed at regulating the modeling industry to the extent that the film industry is regulated, but the same labor laws apply.

Model management companies often take a 20% commission, and they are permitted do so because they are unlicensed and thus are not subject to the 10% commission cap imposed on licensed agents. (There are some modeling agencies that are licensed, but they are less commonly found.)

Again, unlicensed model managers may not procure work for their talent; this means that your model representation contract will likely include several terms delineating duties and restrictions with which you must comply, but your management company is not contractually obligated to attempt to find you work.

The contract may even overtly state that the company “is not licensed as an employment, theatrical, or talent agency…and shall not be required or expected to obtain offers of employment” for you—which is, in reality, the point of any model signing with a model management company, and which is, in reality, the exact function of the model management company. Your lawyer will help you navigate these murky linguistic waters.

2) The service fee

Second, some entertainment lawyers may be surprised and confused to read in your contract that the management company will not only take 20% of a model’s gross income, but will charge the client an additional 20% “service fee.”

This “double-dipping” is standard practice in the world of modeling. This means that your manager will be earning 20% of your gross income plus charging the client another 20% fee on top of the job rate offered to you.

When hiring an attorney to look over your contract, hire an attorney who understands not only the contract language, but also the way that the modeling industry works in practice; this “service fee” clause must be carefully written and understood in conjunction with other contract terms that may interact with this clause so that you are not potentially on the hook for the 20% service fee, partly responsible for collecting its non-payment, or docked pay due to its non-payment.

3) Exclusivity

Third, many contracts will demand exclusivity. This can be too restrictive if you are a model as well as an actor/actress because you may also be working with a talent manager—with whom you also have an exclusive management contract.

The overlap between commercial modeling and commercial acting becomes difficult to navigate; your model management company and your commercial talent agent/manager may be working separately but simultaneously to land you the same commercial job. You should carve out all work unrelated to modeling (i.e., for which you work with a talent manager) by specifying the areas of exclusivity in your modeling contract (e.g., runway modeling) and determine in advance who handles commercial opportunities.

Let your lawyer know if you have existing exclusive talent management contracts that may need to be adjusted to make room for your new modeling contract.

4) Expenses

Fourth, a great way to go into debt is to not keep track of how your money is spent. Model management companies often include a clause in their contracts stating that if they “in [their] sole discretion” advance payment for any model expenses, they can recoup that money by deducting from your paycheck. Instead, your contract should state that any such expenses must be approved by you—in writing—in advance.

It may seem like an unwelcome expense to hire an attorney to look at your contract—especially if you are just starting out and don’t have extra money to spend before you’ve even started working—but it is a necessary investment if you want to protect yourself, advance your career, and maintain long-term financial health.

A version of this article was published on Modelscouts.com.