September 11, 2023

Payroll Best Practices for Animation Studios: Ensuring Compliance and Efficiency

To achieve this delicate balance between compliance and efficiency, animation studios must embrace best practices that adhere to labor laws and industry standards and streamline payroll operations.

We spoke with Senior Animation Production Finance Executive Carolyn Urban to get tips on best practices and compliance without chaos.

About Carolyn Urban:

Carolyn has over two decades of experience in Production Finance and Production Accounting. She is the Manager of Production Finance at Cartoon Network Studios. Prior to that, she was a Production Finance Executive for Kids productions at Amazon Studios.

Ensuring Compliance & Efficiency in Animation Payroll

There are two local guilds that work in animation – Animation Guild 839 and IATSE Local 700, the Editors Guild.

The prominent place to start on compliance and efficiency is to know the contracts that are renegotiated every few years.

The negotiation process can start a year in advance to ensure the artists are paid in full by the payroll company by the end of the term.

Animators don't get meal penalties, but for editors, Golden Time - working overtime after a certain time - is considered a penalty. There is a regular time, time and a half, double time, and then evening hours called night premiums, starting at 8pm 10% more is paid until 1AM, and then 20% kicks in from 1AM until 6AM.


Familiarity with the contracts

Foster open communication with employees about payroll-related matters.

If an issue comes up, the payroll department coordinates with HR and legal to resolve the issue. Address any queries or concerns promptly to build trust and boost overall efficiency.

Understand the contracts

Even though the contracts are usually automated in the payroll company system, and the studio relies on the payroll company, it’s always good to offer a second set of eyes.

Having conversations and exchanges with your payroll company is key to ensuring that the data is up to date and that when new rates come into effect, they are properly paid.

Animation Story Person & Journeyman

When an inexperienced employee joins the company - a recent graduate or an apprentice, for example - they’re paid a specific rate for two six-month periods.

During this period, they’re known as Animation Story Person.

After the initial six months, the producer works with the animator, and if they feel like the animator is skilled enough, they move on to the second six months.

When the second six months go into effect, if the producers feel the animator still needs some improvement, you can get special permission and let the animator know that they can still stay at the first six months rate for a while longer.

After a new animator works their way up, they are called Journeyman.

Find the right Payroll company

When choosing a payroll company for your production, thorough research and careful consideration are paramount.

The relationship with a good payroll company is established long before production starts. The studio always looks for a company with expertise in navigating union agreements, labor laws, and tax regulations specific to the entertainment sector.

Once the payroll company is chosen, it’s time to pick the software platform for the accounting department.

If the production company brings the accountant on early enough in the process, the accountant could choose their preferred software and payroll company.

A good payroll company like Revolution Entertainment Services specializes in the entertainment industry and has a proven track record of handling complex payroll requirements for film, television, and animation projects. Production software, like ProHire and ProBooks, will help you run your productions smoothly. It also helps to implement a reliable time-tracking system to record hours worked by animators and crew members. Accurate timekeeping ensures precise compensation and minimizes disputes.

Set up your accounting office as early as possible during pre-production

Once a payroll company and an accountant are on board, the production office is set up because costs are incurred long before physical production begins.

Plan your accounting needs well. Set up an office for 6 to 8 weeks but not later than a month before production starts, depending on your shooting schedule. Get everything up and going and have your staff hired and software set up.

Hire staff with the skills for maintaining compliance and efficiency

Look for staff who are very detail-oriented, hardworking, and can remain calm while working through issues.

Team player is also an important personality trait when hiring production finance staff.

Conduct periodic audits

Conduct regular payroll audits to identify and rectify potential discrepancies. Audits help maintain accuracy and uphold compliance with industry standards.

Compliance and efficiency don’t have to be so difficult.

Using these tips, the right solutions - and good old-fashioned common sense and vigilance - you too can run a compliant and efficient accounting department during your next production!

The Revolution Team

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