Legal Topics

Benefits Of Incorporating Your Arts Career

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h/t Artsjournal.com for linking to a really valuable article on Observer about considering creating a limited liability corporation (LLC) if you are an artist.  I recently created a post on ArtsHacker summarizing some of the ways in which an LLC protects artist’s personal assets in the case of lawsuits and in some cases, divorce proceedings.

This excerpt from Observer article summarizes how an artist would operate after forming an LLC:

….but most artists operating as one-man shops set up limited liability companies, according to Powers, where the LLC is the employer and the artist is technically the employee. When a sale or commission is made, the money is paid directly to the corporate entity, which then pays the artist, either in a lump sum or in increments (as a salary), and the artist pays taxes on that money as ordinary income. But not all the money transfers directly through to the artist. The corporate entity retains some cash to purchase art supplies, health insurance, workmen’s compensation to protect employees who may get injured during transit or installation, commercial premises and liability insurance—and, assuming the artist is successful enough, to hire employees or consultants.

The article discusses a number of legal scenarios an artist might find themselves in which the buffer of an LLC would be beneficial. More than just providing legal protection, they also note that forming an LLC would allow the artist to solicit investment to support their work.  Take a look at the ArtsHacker post or go straight to the article to learn more.

 

Should Your Work Be Protected By An LLC?

Cleveland Ballet Issues Turned Out To Be Much Bigger Than Initially Suspected

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Back in November, I had written about allegations of harassment by the administration of the Cleveland Ballet of one of their teachers due to body weight issues. I thought that would more or less be the last time I wrote about that particular accusation. However, the results of the investigation by the ballet board has turned into a lesson about boards exercising better organizational oversight.

According to a recent news story, the CEO, Michael Krasnyansky, was essentially forced to resign when the board investigation started and credible accusations of sexual harassment and inappropriate touching emerged stretching back over the course of years.

His wife and artistic director, Gladisa Guadalupe, was just fired after the investigation by the law firm Jones Day uncovered a culture of intimidation and retribution that aimed to obstruct the investigation and a wide range of issues related to financial impropriety and self-dealing.

From the Jones Day report:

-Description by Ms. Guadalupe of complaining dancers as “moles” or “troublemakers” and stating that once the investigation was over, “we will handle the troublemakers.”
-Proposal to lay off employees suspected of communicating with news media.
-Altering Nutcracker cast assignments to the detriment of dancers suspected of cooperating with the investigation.
-Dismissing from the Cleveland School of Dance faculty dancers who cooperated with the investigation.

[…]

-Commingling of funds of Ballet and Cleveland School of Dance, which are separate entities.
-Cleveland School of Dance expenses improperly paid by the Ballet.
-Ballet funds used to pay for personal expenses of Mr. Krasnyansky or Ms. Guadalupe, including personal car insurance, travel, meals, and lodging.
-Restricted donations used to pay for current operating expenses rather than the restricted purpose designated by the donor.
-Significant amounts of endowment donations used for current operating expenses but booked as expenses for the 2023 endowment campaign event

To add a degree of insult to injury, when the the interim artistic director who stepped in when Krasnyansky and Guadalupe were suspended in November was accused of plagiarizing the choreography for the Ballet’s Nutcracker production and ultimately stepped down herself.

When thinking about how this situation could have been avoided, you run into the question of balancing micromanagement by the board with the board exercising appropriate oversight. I suspect that on paper, policies and procedures were in place to avoid the misuse of funds, but the culture of intimidation magnified by the top leadership being married may have made staff reluctant or unable to enforce them.

Similarly, it sounds like it would have been difficult to conduct an investigation or even regular check-in conversations with the dancers about their perceptions of the work environment in the face of the pressure to keep quiet that was being brought to bear.

By no means am I excusing what happened. I am just observing that in hindsight, it is easy to say the board should have been paying more attention. It is difficult to identify what measures they could have put in place which would have provided them with accurate, honest reporting about the state of the the organization given the effort of obfuscate. The Jones Day report said despite all they discovered, they had repeatedly been denied access to most of the materials and records they requested so there are likely other issues which have remained uncovered.

Artists Need High Quality, Accessible Marketing Resources

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Last week, my regional booking consortium organized its first Zoom conversation for marketing staff to share questions, ideas and just generally converse. I lurked around for most of the conversation with my camera off, popping in to comment on occasion. One of the topics of conversation was around marketing and promotional assets that artists provide.  The quality of video and images is an increasingly important topic given the role social media plays with both show promotion and associated sharing.

When I was at a booking conference last month, a panelist mentioned that they look at two things when evaluating whether to book an artist. The first was whether the tech rider was within the capacity and the second was the quality of their promotional assets.  While there was some people in the Zoom meeting last week who said their every use of promotional materials was being closely scrutinized by a tour, far more others complained by the dearth of quality images and video.  Many artists have video which is poor lighting, framing and sound quality.  Still images and logos are often small and can’t be resized without severely bitmapping.

Someone on the call shared an article from Capacity Interactive about how to make static key art more engaging  by adding some subtle animation, using the animation to do some storytelling and provide information.  Obviously, you need to get permission from a performer before adding any animated elements, but I thought that this was a good way to cope with the lack of good materials and catch some attention.

Later in the afternoon, the venue managers and programmers met and some of my enthusiasm deflated a little. One of the topics of conversation was some accessibility legislation that is set to roll out in Colorado in summer 2024. Under those rules we need to pay attention to things like how accessible our websites and ticketing systems are for screen readers. This will mean making sure images have robust descriptions for alt text and videos have captioning. One venue manager said they are already telling renters that logos are not sufficient to represent their shows given the amount of detailed description the law will require.  In this context, I realized the animated key art idea might not pass muster.

While they might not entirely encompass current 2023 standards, Drew McManus did a whole series on web accessibility on ArtsHacker in 2019 which will provide a good start. Bonus: A post on all the lawsuits and accessibility plug-in scams to watch out for.

Strip Club Dancers Return To Work With Actors’ Equity Representation

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Last September I made a post about strippers working at a club in Los Angeles who were approaching Actors’ Equity Association to help them unionize their workplace. Today I saw on CNN.com that they had indeed held a successful unionization vote under the auspices of Equity last May (NPR story).

While the setting of the strike may add a salacious air to the story, the basic details of the effort are pretty common across all unionization fights. The dancers forming the union were contesting their categorization as contractors rather then employees, seeking better working conditions, and better assurances of their safety and security. There were lock outs, picketing, suits contesting the dancers’ right to form a union.

It appears they don’t have a contract yet, but the dancers returned to work at the end of August in a gesture of mutual trust based on physical improvements that had been made during renovations as well as changes in policy and practice.

Actors’ Equity suggests that the legal rulings that lead to this may set a precedent for other workers in the beauty and entertainment industries to be categorized as employees rather than contractors.