Industry Trends

Episode 20: How To Standardize and Simplify Pay Rules

Angela Alea's teaching us three ways we can standardize and simplify our pay rules and walking us through the benefits of doing so.

What we're talking about 💬

  • Three reasons to standardize and simplify how you pay crew.
  • How to leverage one of the biggest benefits our industry has to offer. 
  • How to ensure fewer mistakes on paychecks. 
  • Why complicated = expensive.
  •  The two things that have acted as a catalyst to simplify pay rules. 
  • Why a majority of companies are converting to weekly overtime. 
  • Why your bill rules and pay rules do not have to mirror each other. 
  • How standardizing pay rules will help recruit people to the live events industry. 

Listen 🎧


Watch 📺


Read The Transcript 📚

[00:00:34] Angela Alea: Today I want to dive into standardization, but really around kind of one important topic and that is pay rules. So despite not much being standard in our industry, I do think we can all agree on the importance of paying our people well. Paying them often and definitely important is paying them accurately.[00:01:00]

[00:01:00] Angela Alea: So, we often hear from freelancers. They complain about having to either chase their money. Or not even really understanding how they're even getting paid. And we as an industry, we need to pay attention to this. If we're gonna be successful at recruiting new talent, it needs to be frictionless for them.

[00:01:18] Angela Alea: People need to not only understand how they're getting paid, but quite honestly, they should be excited about it, understand it. How many of you have documented somewhere about how you pay? Most companies just think through the obvious, like, We're gonna pay regular pay for this time and then pay overtime at this.

[00:01:36] Angela Alea: but what about holiday pay? What about if someone has two pay rates during the week and then hits overtime? What if someone's call ends at 10:25 PM Are you paying them through 10 25, 10 30, rounding up to 11:00 PM Unfortunately, our industry has really over complicated. One of the biggest levers we have to recruit great talent.

[00:01:58] Angela Alea: Why do we do. [00:02:00] This often leaves you with more to explain to your freelancers when you recruit them more to review when you onboard them. And let's face it, it's a whole lot to manage on the back end when it's time to pay them to all you freelancers out there. How frustrating is it working for eight different companies, all of which pay you not only different rates, but the rules about how you get paid differ.

[00:02:23] Angela Alea: Great. And what about you companies out there? How much time are you spending each pay period trying to calculate how you're even gonna pay your people? Again, applying all of these complicated rules, many of which can be in conflict, right? These are your rules, but if this scenario happens to happen, it could completely eliminate one of the rules.

[00:02:47] Angela Alea: So there's all of these really complicated, conditional ways of paying. And it's always been fascinating to me to review these payroll documents that companies give to their new hires. [00:03:00] And some companies, you know, it's funny to watch them try to explain how they pay their people. And if it takes a 10 page document to do that, that's a problem.

[00:03:08] Angela Alea: But I'm quite certain this is the result of the union contracts out there. But hey, if you're not a union, you don't have to overcomplicate this year of your. So here are three reasons to standardize and simplify how you're paying your people. The first reason is, let's face it, it creates happier crew having simple and easy to understand rules of engagement for pay.

[00:03:34] Angela Alea: It makes everyone happier if we're essentially trying to sell a career in events, which we're all doing, right? We're trying to get people to come back or choose this, this industry. So if we're trying to sell a career in events, let's make it easy to buy. Let's not over complicate it. Let's make it easy to explain.

[00:03:50] Angela Alea: Here's how you make money in this industry. So standardizing how you pay also, Fewer mistakes on paychecks, [00:04:00] and we all know there's zero tolerance as there should be for incorrect paychecks, but the more you complicate it, the more error opponent it gets, and the more that could lead to frustration with your crew and freelancers.

[00:04:12] Angela Alea: and last is complicated, just quite honestly equals expensive, and it's hard to believe, but some companies still have their entire payroll teams manually calculating payroll each week because they've over complicated their rules so much that it takes three people, three days just to calculate payroll.

[00:04:31] Angela Alea: It's a perfect lesson that less can be. So I personally wanted to look across the industry to see what were the norms, were there any trends, patterns, what were the most common ways people paid? Our companies paid their people. So I was encouraged by these findings and how they compared to even two to three years ago when I went through the same exercise.

[00:04:54] Angela Alea: So the introduction of AB five, which essentially mandated freelancers in our industry be [00:05:00] paid as a W two, really kind of forced them to follow more simplified payrolls. And then the second thing I think has affected this is covid. Because those two things have really been the catalyst for our industry to begin to simplify things.

[00:05:15] Angela Alea: So we certainly still have a lot of work to do as an industry, but here are a few of our findings. These are really interesting statistics, and this is across hundreds and hundreds of companies. in the event space. So we found 76% of companies pay weekly overtime after 40 hours in a week. So this has been largely in part due to companies converting their workforce to W two and now having to comply with F LSA and Department of Labor Rules on the flip.

[00:05:48] Angela Alea: Only 17% pay overtime after 10 hours in a day. Again, because so many have converted to weekly overtime, we also found 26% pay [00:06:00] overtime between midnight and 6:00 AM. Surprising to me was only 19% of companies pay either overtime or double time on holidays. I mean, let's face it, our industry is 365 days a year, 24 7.

[00:06:16] Angela Alea: And if you're asking for them to work an event on a holiday, only 19% of companies are paying a premium for those. Another one is 86% of companies, so clearly the majority are not. Rounding time worked. So in that example from earlier that I gave, if the call wrapped at ten twenty five, eighty 6% of companies are paying them through 10 25 and not rounding up to 10 30 or even to 11.

[00:06:45] Angela Alea: Of those that small percentage that are doing some rounding, 60% of those are only rounding to the quarter hour. So again, for billing purposes, which is a whole different topic, you can continue to bill your hours up to the next hour. Very common [00:07:00] practice. But your bill rules and pay rules do not have to mirror each other.

[00:07:07] Angela Alea: And then the last but not least, are daily based minimums. The two most common daily minimums are five hour and 10 hours, but almost no companies out there across the hundreds that we looked at are applying hours not worked towards that weekly overtime. So for example, if I'm a an operator and I'm on a 10 hour minimum, And I only work eight hours in the day cuz that's what it calls for.

[00:07:32] Angela Alea: The, I'm gonna get paid for 10 hours, but only eight of those hours are gonna go towards overtime, which that's pretty standard. Of course there are those that still calculate things like short turnaround, blended over time, and some other nuanced rules, but those really aren't as common as they used to be in years past.

[00:07:51] Angela Alea: We have a number of things to standardize in our industry, but my hope is we can tackle standardizing payrolls first, cuz it's gonna help us [00:08:00] recruit more to the industry, simplify things for both companies and crew, and it's gonna allow us to spend less time calculating payroll and more time investing in our people.

[00:08:10] Angela Alea: So hopefully that gives us something to all think about and something to strive for because the more we can simplify. The better we are, the faster we can move. So thanks for joining us today. Give that some thought. Be sure to subscribe and reach out with any comments or feedback to

[00:08:33] Angela Alea: Thanks so much.


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