Contract Labor as Production Cost
Okay so you’ve got the Material Costs organized and well tracked. Now let’s talk about Contract Labor. Your time and labor will never be reimbursable unless you are working on a large commission for some public work project, and you will submit an invoice for your artist fee. I don’t see any other exception to this rule. But the labor that you pay for can go towards Production Costs. Now if you paid someone to paint a painting or draw a drawing that you then sell as your artwork, that’s a little more difficult to charge a gallery as production costs. I’ve seen it but very, very rarely. What I have seen and what is becoming more and more common are labor intensive mixed media / sculptural works and film / video and sound because it really takes an army sometimes to make these works possible.
So how do you begin to track these expenses and ultimately get reimbursed for them? You must keep time sheets. You can do this on paper, you can do it in a spreadsheet, but there is really no other way to keep track of these expenses. I have several clients that have spreadsheets open on their studio computer, each person has their own tab in the spreadsheet and at the end of the day, they go in and type in that they spent 5 hours on one sculpture and what they did briefly (mold making, filing, pouring, architectural drawing) and then 2 hours on another sculpture and what they did. Then before the work goes to the gallery, the artist or studio manager or someone like me goes in and tallies all the time sheets and what their hourly rate is and all the receipts and provide a breakdown for the gallery of what amount went towards labor and what amount went toward materials. Then the final number is what goes on the consignment form for that work. Here is what my consignment might look like.
John Smith
Untitled, 2012
Latex, silicon, resin, paper and pigment
45 x 60 x 15 inches
Retail $10,000
Production Costs $2,000
Then the detail breakdown that would accompany the consignment would look like this:
Labor:
Paul Lane (60 hours at $20 per hour) $1,200
Materials:
Latex $600
Resin $100
Pigment $100
Total Production Costs: $2,000
I think I know what you are thinking: this is way too time consuming. I can’t track every hour that my people are working. And they are working on multiple projects all at once. And I don’t know which works are going to pan out or not. How can I accurately track their time and make it simple for everyone? There isn’t an easy answer. I find that when you set up systems in a work environment it is often met with resistance but you need that system in order to get paid, in order to keep your studio up and running and mostly importantly for your people to stay employed. So once a system like this is in place it becomes habit and part of the job. It is also really interesting to look back and see what works actually cost you in labor. Materials are pretty easy to track, but when you really factor in the labor, you will be astonished at what things are really costing you. I think this will be even more incentive to track the hours and get reimbursed for all the money you spend.
Next blog will cover how you protect yourself when it comes to Contract Labor.
Workmen’s Comp / Insurance / LLC
