Industrial Relations Commission New South Wales Medium Neutral Citation: Paul Rafferty v Eva Yvette Rinaldi t/a Human Statue Bodyart [2017] NSWIRComm 1069 Hearing dates: 14 November 2017 Date of orders: 17 November 2017 Decision date: 17 November 2017 Jurisdiction: Industrial Relations Commission Before: Commissioner Seymour Decision: Orders to pay unpaid performance fees plus interest Catchwords: Dispute pursuant to s 20 of the Entertainment Industry Act 2013 – payment of performance fees to performer – amount performer representative entitled to deduct for fee – requirement for entertainment industry management agreement to deduct more than 10% of total amount payable to performer Legislation Cited: Industrial Relations Act 1996, s 136 Entertainment Industry Act 2013, ss 4, 5, 6, 9, 11, 20 Entertainment Industry Regulation 2014, r 4 Category: Principal judgment Parties: Paul Rafferty (Applicant) Eva Yvette Rinaldi t/a Human Statue Bodyart (Respondent) Representation: I Spooner, Media Entertainment and Arts Alliance (Applicant) M Gentili (Respondent) File Number(s): 2017/266566 decision 1. This is an application by Paul Rafferty (Mr Rafferty) under s 20 of the Entertainment Industry Act 2013 (the Entertainment Act). 2. Mr Rafferty claims an amount is owed to him by the respondent Eva Rinaldi t/a Human Statute Bodyart ABN 58 622 462 184 (Ms Rinaldi) for work Mr Rafferty performed on a television commercial. 3. The application was listed for conciliation before me on 8 September 2017. There was no appearance by or on behalf of the respondent and I therefore made directions for arbitration of the matter. 4. Mr Rafferty filed an Affidavit on 28 September 2017 (Exhibit 1) and a Statement in Reply on 10 November 2017 (Exhibit 2). Ms Rinaldi filed a document in the form of a statement with annexures on 20 October 2017 (Exhibit 3). 5. Mr Rafferty did not appear but was represented at the hearing of the claim by Ms Spooner of the Media Entertainment and Arts Alliance (MEAA). Ms Rinaldi did not appear but was represented by a Business Consultant Mr Gentili. Neither Mr Rafferty nor Ms Rinaldi were required for cross-examination. Both parties made oral submissions. I have taken into consideration the evidence filed and the submissions in making this decision. Relevant legislation 1. The Entertainment Act prescribes a framework for the payment of performers in the entertainment industry in New South Wales. It sets out the rights of performers and the obligations of performer representatives in respect of payment for work. The relevant provisions are as follows: 4 Definitions (1) In this Act: … entertainment industry agreement means an agreement between a performer and a performer representative for the performer representative to provide one or more of the services referred to in section 5. entertainment industry hirer means a person who engages or contracts any performer for the purpose of a performance. … performer means any actor, singer, dancer, acrobat, model, musician or other performer of any kind who enters an entertainment industry agreement with a performer representative. … 5 Performer representative In this Act, a performer representative means a person who, for financial benefit, provides or agrees to provide one or more of the following services to a performer (whether or not the agreement also provides for other services to be provided): (a) seeking or finding work opportunities for the performer, (b) negotiating terms of an agreement for, and the conditions of, a performance, (c) finalising arrangements relating to the payment of the performer, (d) negotiating arrangements relating to the attendance of the performer at a performance, (e) administering the agreement between the performer and an entertainment industry hirer, (f) making arrangements for publicity attendances and related publicity responsibilities of the performer, but does not include a person who does so solely as an employee of any such representative. 6 Trust accounts to be established by performer representatives (1) A performer representative who receives money on behalf of a performer, from any person, must: (a) hold the money exclusively for the performer, and (b) ensure that the requirements of this Act and the regulations under this Act are complied with in relation to the money. (2) Money received on behalf of a performer by a performer representative that is not paid to the performer immediately (or within such period as may be prescribed by the regulations) must: (a) be paid to the credit of a general trust account at an authorised deposit-taking institution in New South Wales and be held in accordance with the regulations, and (b) be disbursed as directed by the performer within 14 days after the performer representative receives the money. …. 9 Capped amount of performer representative fees (1) The capped amount for the fees and other remuneration of a performer representative is: (a) the percentage, prescribed by the regulations, of the total amount payable to the performer for any performances in respect of which the performer representative provided services under an entertainment industry agreement, …. 11 Fees of performer representatives (1) A performer representative must not demand or receive a fee or other remuneration from a performer under an entertainment industry agreement that exceeds the capped amount, unless the agreement is an entertainment industry managerial agreement and the additional services under the agreement are provided. … 1. The Entertainment Industry Regulation 2014 (the Regulation) provides for the capped amount as follows: 4 Fees of performer representatives (1) For the purposes of section 9 (1) (a) of the Act, the following percentages of the total amount payable to a performer in respect of a performance are prescribed: (a) in the case of a performance involving live theatre or a live musical or variety performance (being an engagement that does not involve film, television or electronic media)—10 per cent for any period up to 5 weeks and then 5 per cent for any period after 5 weeks, (b) in all other cases (including an engagement involving film, television or electronic media)—10 per cent. (2) For the purposes of subclause (1), the following amounts (being amounts payable to performers) are to be excluded when calculating the total amount payable to a performer in respect of a performance: (a) travelling and meal allowances, (b) holiday pay, (c) any long service leave and superannuation payments, (d) any overtime or penalty payments that are paid on an irregular basis, other than payments resulting from negotiations undertaken by the performer representative on the performer's behalf with the relevant entertainment industry hirer or venue representative, (e) any award or minimum payments in respect of rehearsals. 1. In applying these legislative provisions, the questions for determination in this matter are as follows: 1. Was Ms Rinaldi a 'performer representative' of Mr Rafferty? 2. Did Ms Rinaldi receive money on behalf of Mr Rafferty? 3. If the answer to these questions is 'yes', what amount was Ms Rinaldi entitled to receive as fees or other remuneration and subsequently deduct from the money otherwise payable to Mr Rafferty? Relevant evidence 1. After a successful audition in January 2015, Mr Rafferty performed work as a silver human statue on a television commercial for Volkswagen on or around 5 February 2015. Ms Rinaldi and her team did Mr Rafferty's body art for the performance. Ms Rinaldi also transported Mr Rafferty to and from the performance 'shoot'. 2. Ms Rinaldi's evidence was that in around March 2015, her former Marketing Communications Manager sent an invoice from Human Statue Body Art to TalentPay Pty Ltd for $4,000. For the purposes of the Entertainment Act, TalentPay Pty Ltd are an 'entertainment industry hirer', being a 'person who engages or contracts any performer for the purpose of a performance'. Ms Rinaldi's invoice was paid by TalentPay Pty Ltd on 21 April 2015. In respect of the Volkswagen commercial, the Remittance Advice states a gross amount of $4,075, a deduction of $815 and a net amount of $3,260. It is not in dispute that Ms Rinaldi received the amount of $3,260. 3. Mr Rafferty realised in around June 2015 that he had not received any payment from Ms Rinaldi for the Volkswagen commercial. He thought that perhaps he needed to invoice Ms Rinaldi and subsequently sent an invoice to her for $4,000 on 3 June 2015. His evidence was that when Ms Rinaldi first contacted him in January 2015 to see if he was interested in auditioning for the commercial, she verbally told him that 'the pay for the role is approximately $4,000'. Ms Rinaldi agrees she verbally advised Mr Rafferty of this amount, however she also told him the fee included her costumes and make-up. 4. After a further period of non-payment and some email communications between them, Ms Rinaldi requested Mr Rafferty re-invoice her minus GST and 20%. In an email dated 15 December 2015, this was stated by Ms Rinaldi to be for her 'costume, makeup and booking services'. Mr Rafferty responded to Ms Rinaldi on 20 January 2016 that the deduction of the 20% fee was 'never disclosed, discussed nor agreed on, verbally, written or otherwise' and he would therefore not pay it. 5. On 6 April 2016, Mr Gentili sent an email to Mr Rafferty in the capacity as Ms Rinaldi's Business Consultant. He noted the 'reservations/confusion regarding payment' and sought to resolve the issue so as to make payment to Mr Rafferty. Mr Gentili stated in his email: "It was agreed at the time that payment would be made to you less (20%): * 10% Office Expenses * 10% Booking Fee On Audition day Human Statue Body Art supplied * Costuming * Makeup artist * 15 artists auditioned On Filming day Human Statue Body Art supplied * Costuming * Makeup artist While Human Statue Body Art does not have to divulge any Business matters regarding costs, we are happy to do so on this occasion for a fast and happy resolve [sic] to all parties Payment on the day was as follows * $2,963 + GST * $3,260 GST inclusive * Minus 20% = $2,370.40 Costs incurred by Human Body Art * Costuming for Audition and film day $600 + GST * Makeup artist for Audition and film day $700 + GST * Paul Rafferty – minor role $1,070.40 (No GST) Paul please resend correct invoice so payment can be made." 1. Mr Rafferty then approached the MEAA for assistance in relation to the matter. 2. It is not in dispute that there was no written contract between Mr Rafferty and Ms Rinaldi in respect of the work. The contractual documentation that was in evidence was the following: 1. 'Deal Memo' from Danny Long Casting specifying (among other things) the date of the shoot and the Actors Fee, being $4,000 – this was signed by Ms Rinaldi; and 2. 'Contract between TalentPay Pty Ltd and Artist (Individual)'. This Contract specified the Negotiated Performance Fee of $4,000 and stated that 'by signing this contract you agree that the fee you will receive on behalf of Paul Rafferty will be as per this agreement less relevant taxes'. This document was to be signed by Paul Rafferty, Talent Pay and the client (Volkswagen Group Australia). However Mr Rafferty did not sign the contract. His evidence was that he never received a copy of the contract and did not see it, until the MEAA obtained it from TalentPay Pty Ltd in preparation for these proceedings. Was Ms Rinaldi a 'performer representative'? 1. In respect of his work on the Volkswagen commercial, Mr Rafferty was clearly a 'performer' for the purpose of Entertainment Act, being an 'actor…model… or other performer of any kind'. I also consider that Ms Rinaldi was a 'performer representative' of Mr Rafferty for the purpose of the Entertainment Act. In order to be a 'performer representative' under s 5 of the Entertainment Act it is only necessary to provide one of the listed services to a performer. On the available evidence, in my view Ms Rinaldi provided a number of services to Mr Rafferty as follows: 1. she found the work opportunity for Mr Rafferty, namely the Volkswagen television commercial (s 5(a)); 2. she finalised arrangements relating to the payment, namely the amount of 'approximately $4,000' in respect of Mr Rafferty's performance on the commercial as a human statue (s 5(c)); 3. she negotiated arrangements relating to the attendance of Mr Rinaldi at the commercial shoot (s 5(d)); and 4. she administered the agreement between Mr Rinaldi and an entertainment industry hirer, being TalentPay Pty Ltd (s 5(e)). 1. Ms Rinaldi provided these services for financial benefit. Emails from Ms Rinaldi and Mr Gentili refer to a 'booking fee'. Ms Rinaldi rhetorically asked Mr Rafferty in her email of 21 January 2016, 'did you expect me to book, style and cast you…for this job and not make any money? We are not a charity sorry…..' Accordingly, Ms Rinaldi was a performer representative and an entertainment industry agreement existed between Mr Rafferty and Ms Rinaldi for the purposes of the Entertainment Act. Did Ms Rinaldi receive money on behalf of Mr Rafferty? 1. I consider that Ms Rinaldi has received money on behalf of Mr Rafferty in respect of his performance in the Volkswagen commercial. As noted above, the Remittance Advice from TalentPay Pty Ltd to Human Statue Body Art provides for an amount of $4,075 - $815, resulting in a net payment to Ms Rinaldi of $3,260. There was a dispute about what the $815 deduction was for. Ms Rinaldi variously stated in her evidence that it was for TalentPay Pty Ltd's fee or GST. However a document provided to Mr Rafferty by TalentPay Pty Ltd makes it clear that the deduction was for PAYG tax in respect of the amount of $4,075 payable to Mr Rafferty. Mr Rafferty's evidence was that because the payment was made against his tax file number he has been liable for the full amount of tax of $815, however without receiving the $4,075 payment. What amount was Ms Rinaldi entitled to deduct as fees? 1. Mr Gentili submitted that Ms Rinaldi performed significant work as part of preparing Mr Rafferty (and other talent) for the audition and subsequently on the day of the shoot. I accept that she incurred time and costs in doing so. Mr Gentili submitted that the Entertainment Act operates unfairly if it prevents Ms Rinaldi recovering those costs in the present case and that cannot be the intention of the legislation. Ms Spooner acknowledged that people should be paid for the services they provide, however they should not be paid from Mr Rafferty's performance fee unless there was a written agreement that outlined those deductions prior to the work being performed. 2. I consider it is clear that Ms Rinaldi is prohibited under the Entertainment Act from demanding or receiving a fee or other remuneration from Mr Rafferty that exceeded 10% of the total amount payable to Mr Rafferty. Ms Rinaldi could recover a fee and/or actual costs exceeding that 10% if she had entered into a written entertainment industry management agreement with Mr Rafferty that included an additional fee acknowledgement by him. Sections 10, 12 and 13 of the Entertainment Act set out a number of requirements for such an agreement, including that it be in writing, contain fixed fees and the performer has been provided with certain prescribed information and a 'cooling off period'. This is a course that is open to Ms Rinaldi in respect of any future arrangements with performers to enable her to recover fees and costs above the 10% capped amount. 3. As noted above, Ms Rinaldi's evidence was that she informed Mr Rafferty that the job paid approximately $4,000 'but this fee also included our costumes and makeup'. Mr Rafferty disputes this. In any event, there is no written agreement specifying what the amount for costumes and makeup would be, whether as a percentage or on any other basis. There is certainly no document that satisfies the requirements of the Entertainment Act in respect of an entertainment industry management agreement. 4. I have considered Mr Gentili's submission regarding fairness. However in my view there is no discretion available to the Commission to waive or alter the prohibition on deduction of fees or remuneration above the 10% cap without a written entertainment industry management agreement. Applications to the Commission in respect of matters under the Entertainment Act are commenced by way of a dispute. Section 20 of the Entertainment Act provides as follows: 20 Disputes may be resolved by Industrial Relations Commission (1) If a question, dispute or difficulty arises between a performer and an entertainment industry representative or entertainment industry hirer, the performer, or an industrial organisation acting on behalf of a performer, may apply to the Industrial Relations Commission to have the matter determined by conciliation and, if necessary, arbitration. (2) The Industrial Relations Commission may conduct such a dispute resolution process in such manner as the Commission considers appropriate. (3) The Industrial Relations Commission may make such orders in relation to such a question, dispute or difficulty as the Commission considers fair and reasonable in the circumstances. (4) A person who fails to comply with an order of the Industrial Relations Commission under this section is guilty of an offence. Maximum penalty: 50 penalty units or imprisonment for 6 months, or both. [Underlined emphasis added] 1. Sub-section 20(3) does give the Commission a broad power to make orders in the arbitration of a dispute in relation to the Entertainment Act that are 'fair and reasonable in the circumstances'. However s 20 of the Entertainment Act must be read in conjunction with s 136 of the Industrial Relations Act 1993 (IR Act), which provides as follows: 136 Arbitration of dispute (1) The Commission may, in arbitration proceedings, do any one or more of the following: (a) make a recommendation or give a direction to the parties to the industrial dispute, (b) make or vary an award under Part 1 of Chapter 2, (c) make a dispute order under Part 2, (d) make any other kind of order it is authorised to make (including an order made on an interim basis). (2) Any such action may be taken by the Commission on its own initiative or on application by any person authorised to notify the Commission of the industrial dispute. [Underlined emphasis added] 1. In my view, an order which permitted Ms Rinaldi to deduct more than 10% from the total amount payable to Mr Rafferty in the absence of a written entertainment management agreement would be in direct contravention of the Act and thus not an order the Commission is authorised to make. 2. Even if such an order were authorised I do not consider it would be 'fair and reasonable' in the circumstances of this matter. The verbal communication of the amount payable to Mr Rafferty as 'approximately $4,000' without specification of any amount to be deducted was regrettably ambiguous. On Ms Rinaldi's own evidence at no time did she convey to Mr Rafferty, even verbally, the percentage she ultimately sought to deduct as her fee of 20% or what the costs of the 'costumes and make-up' would be. This lack of clarity resulted in the dispute between the parties that has brought them to the Commission. What was the total amount payable to Mr Rafferty? 1. The final issue is 'the total amount payable to Mr Rafferty' upon which the permissible 10% capped fee is calculated as set out in s 9(1) of the Entertainment Act. Ms Spooner submitted it was the amount of $4,075, being the gross amount payable by TalentPay Pty Ltd. This resulted in a 10% fee of $407.50. 2. I considered whether the 'total amount payable to Mr Rafferty' could be the net amount of $3,260 i.e. after deduction of taxation. However this would be the total amount actually 'paid' to Mr Rafferty rather than the total amount payable to him. Accordingly the relevant amount is the gross amount of $4,075. Ms Spooner advised that this was consistent with industry practice. 3. Section 6(2) provides that the money received on behalf of a performer by a performer representative must be disbursed to the performer within 14 days after receipt. Therefore the amount owed by Ms Rinaldi to Mr Rafferty is $2,852.50, calculated as follows: 1. $3,260 - the amount actually received by Ms Rinaldi from TalentPay Pty Ltd after it deducted applicable PAYG tax in respect of Mr Rafferty; 2. minus $407.50 - Ms Rinaldi's 10% permissible fee. 1. Mr Rafferty sought interest on the amount owed from 5 May 2015, being 14 days after the date Ms Rinaldi received the money from TalentPay Pty Ltd, namely 21 April 2015. As s 6(2)(b) of the Entertainment Act expressly requires payment within 14 days of receipt, the interest claimed is so ordered. Orders 1. Having considered all the material before the Commission, I make the following orders: 1. Ms Rinaldi is ordered to pay Mr Rafferty the sum of $2,852.50 in respect of the non-payment of performer's fees. 2. In addition, Ms Rinaldi must pay interest on the above amount at the prescribed rate set from time to time for the purposes of s 100(1) of the Civil Procedure Act 2005 on and from 5 May 2015. 3. These amounts must be paid to Mr Rafferty within 28 days of the date of this decision. JANE SEYMOUR Commissioner ********** Amendments 24 November 2017 - In paragraph 30(2) of the Decision, delete 's 95(1) of the Supreme Court Act 1970' and insert instead 's100(1) of the Civil Procedure Act 2005'. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 24 November 2017