To Pay or Not to Pay: That is the Question: Local Performers and the Shadow Economy 

Should musicians be willing to work for free?

A fairly robust online conversation regarding local music venue The Shredder broke out May 5, 2012.

"We are starting an official boycott of The Shredder," Bruce DeVino Jr., drummer in local band Killing for Peace, posted on Facebook. "The last thing Boise needs is another bar that refuses to pay local bands and charges local bands full price for a beer. ... Who's with us? Let's shut him down."

DeVino then wrote that he was in the process of starting his own rival venue, one that not only would compensate all performers, but also offer assistance loading gear.

The ensuing conversation ran to nearly 100 comments and included several ethnic slurs. But despite his personally motivated gripe, DeVino raised a consistent and relevant question venues face when booking performers: to pay or not to pay?

Survey says: We're broke

An online survey by Boise Weekly of 40 local musicians and comedians found that 90 percent of them performed weekly or monthly, but only 30 percent of them were paid consistently. Another 17.5 percent reported being paid "most times," and 52.5 percent reported being paid only "sometimes" or "rarely."

BW's survey also found that the average amount performers earn from a gig is $81.58. That may not sound so bad for what might be seen as an hour of work, but that one hour of stage time can require several hours of equipment loading time, thousands of dollars in equipment costs and hundreds of hours of practice time.

Then it needs to be split among the number of performers on the bill, and often only after paying out whoever is working sound. Then there is the possibility of a radius clause in performance contracts stating a performer cannot book other gigs within certain time frames or geographical distances.

The bigger the gig, the bigger the clause. Though they generally pay better, for large-scale festivals, performers can find themselves banned from stages across multiple states for months.

Performers used to be able to make up the difference selling merchandise but as digital media has decimated record companies, so has it decimated the ability of independent acts to get by on the pay they receive for performances.

The average is also heavily skewed by the few performers who pull decent pay.

More than two-thirds of respondents to BW's survey said they are paid less than $50 for a performance, with 35 percent reporting less than $25 per performance. Only 9 percent reported making more than $200 at a gig.

And it isn't just a local issue. Amanda Palmer, singer for Boston band The Dresden Dolls, ran head on into the controversy after placing an ad on her website searching for musicians to play in an orchestra at various tour stops. The catch: Artists had to be willing to be paid in beer, hugs and high fives.

When the ad received heavy criticism, she wrote a roughly 3,000-word blog post in her own defense. She detailed her financial history as a musician, including free shows on beaches, richly rewarding performances in symphony halls and how much money her band lost on tour opening for Nine Inch Nails.

"Good lord, were we grateful to lose that money," she wrote. "It won us a huge bunch of fans."

Palmer discussed paying her opening acts by passing a hat, paying David Byrne of Talking Heads with beer--though she didn't even know if he drank--and once rehearsing and performing a guest spot gratis with the band opening for her at a college show.

"You don't have to play for free," she wrote, "but I hope you won't criticize me for wanting to." Palmer then discussed how every member of her band is paid differently, and how in larger markets, there wasn't a supply of orchestra musicians who could fill the bill without payment. That's why some would be paid high fives instead of fivers.

She also pointed out how her tour opener was being paid to open, but not for the slots they were filling in the orchestra, and how they were traveling in her tour bus so as to avoid having to follow in a van and so on and so on.

"Does the math all work out?" she wrote. "Who knows. But we're all happy with the situation."

More than just a way to stretch a tour budget, Palmer envisioned it as a fun way to involve her audience more in her music, an idea she further fleshed out in a TED Talk called, "The Art of Asking."

"It's sometimes messy, sometimes not. Sometimes slightly risky and therefore, in my opinion, fun," Palmer wrote.

After the incident was written about in everything from Spin to The New York Times, the Pitchfork-reading masses gathered at her gates. Palmer eventually backed down, made agreements to pay the musicians and pulled down her blog post. But Palmer's management of a PR crisis didn't change the underlying facts: Even at the highest levels, musicians and performers work in an industry in which there is no shortage of money being made, but there are few guarantees they will see any of it.

Were other laborers in clubs such as servers and bartenders paid so randomly, the outrage might run red in the streets. But the underlying Bohemian ethos of working musicians keeps much of it in check.

And then there is the spurious allegation of "sellout" thrown at a performer who dares to sign a record or management contract.

A panel at this year's SXSW conference on constructive and disruptive technology in the music industry addressed that ethos fairly directly.

"There's a stigma musicians have about being on top of their shit," said panelist Brooke Parrott, a musician and artist ambassador for touring website SongKick.com. She felt that stigma was holding back musicians' ability to take control of their careers from an industry that has historically exploited them.

The panels' moderator, Jim Carroll, a journalist for the Irish Times, agreed.

"That thing about not being a suit," he said. "You have to get over that."

Shadow Economy

Scraping by gig to gig--often ending up with nothing to show for it--is not ideal, but it's all kosher from a legal perspective.

Grant Burgoyne, employment attorney, Boise Democratic representative in the Idaho Legislature and amateur guitarist, said that--to massively simplify complex labor laws--pretty much the moment a performer brands him or herself with something like a website or a Facebook page, he or she is considered an independent contractor, not a standard employee.

That means clubs can offer as much or as little as they like and performers can take it or leave it--and it is all perfectly legal. If the amount agreed upon happens to be a pittance, or the numbers don't work out quite as planned. There isn't much a lawyer or courts can or will do about it.

"There are certain things about the law that are impractical to enforce," Burgoyne told Boise Weekly.

Many lawyers aren't likely to take on cases in which less than $3,000 is in dispute and the constant crossing of state lines that is part of working as a performer means the law and those practicing it differ from place to place.

Though performers are paid in as many ways as there are types of club owners and acts, one thing remains consistent: They're mostly outside the traditional employer-employee model of bookkeeping.

The result is what economists refer to as a shadow economy, a largely unregulated industry whose employers and laborers' adherence to tax and labor law is as solid as Swiss cheese. Some do, some don't. Either way, it's less than ideal.

Strange as it may sound, being an independent contractor is actually better for performers than being a time-card puncher.

Burgoyne told BW that hiring artists as employees not only involves enough paperwork to discourage most clubs from ever having live performances, but performers would only be guaranteed minimum wage for the time they're on stage. If they hit 40 hours a week, then they could be eligible for health care and overtime, but performance jobs like that are about as common as sasquatches.

"I don't think it's unfair or exploitative for people to give away their services to give it a try," Burgoyne said. "I'm also not trying to make it as a guitarist," he added.

Burgoyne compared it to the old adage that the best way to get a job is to volunteer. But he also made his feelings explicit.

"If there's a cover charge, it's sure going to raise my alarm if the performer isn't getting paid. Performers deserve to be paid. Especially when the people hiring are making money off their services."

In many larger markets, clubs actually go one step further and reverse the process altogether, making performers pay for stage time through stage rental fees or "pay to play," pre-sale ticket schemes. In that respect, Boise performers can be better off than those in larger markets.

Many performers turn to busking--street performing for tips--to make money. However, the patchwork of regulations on everything from amplified sound to the legality of putting out a hat--some cities consider this panhandling--can make busking as much a challenge as performing in a venue.

The most common forms of payment reported in BW's survey were flat fees, cuts of the door and percentages of bar sales.

Asked if they thought there was a better system, local performers gave BW a range of answers, from improved labor laws to promoters working harder to promote shows rather than relying on performers to do all the work. One respondent simply said "socialism." It's not as glib as it sounds. Some Scandinavian countries provide large cash subsidies to performers and venues, making it one of the most lucrative places to be a performer and an affordable place to be a music fan.

"I think the door take and percentage of bar sales should both be tabulated and the performer should get whichever total is higher," one survey respondent wrote.

"I'd just be happy to get health insurance," wrote another.

But some also thought things were fine as they stand.

"Every artist has the opportunity to negotiate fair compensation and can reject or accept every offer," reported yet another survey taker.

The Bottom Line

While the lack of data defining shadow economies makes them difficult to study, significant data has been gathered on the spike in the number of unpaid internships since the financial crisis in 2008. And on those, economists are quite clear: The ability to not pay people decreases the likelihood that employers will pay anyone. And it isn't just employers taking advantage of people, it's that non-paying jobs undermine job market stability.

A recent article in The New York Times got to the heart of the issue when it delved into the business model of a Manhattan comedy club, The Upright Citizens Brigade.

"How did the comedy juggernaut solve the intractable problem of live theater today, the inexorable rise of ticket prices? Simple: don't pay performers for their work onstage," read the article.

By not paying performers, the very profitable for-profit club was able to undercut other venues on ticket prices and provide packed houses for performers. That sold performers on free appearances for self-promotional purposes. But it also left other Manhattan clubs that do pay struggling to fill more expensive seats to make the money required to pay performers, thereby further restricting the number of paid opportunities.

Unsurprisingly, it is a contentious model; but since all performers who take part in it do so by choice, even if grudgingly, it is completely legal.

The effects of that case study are also reflected in a speech given by Recording Industry Association of America CEO Cary Sherman at the Personal Democracy Forum in June 2012.

In the talk, Sherman cited a report from the Bureau of Labor Statistics that showed a 41 percent decline in the number of professional musicians since 1999. That statistic was challenged, however, by some tech folks as being not reflective of the changing revenue and professional definition models birthed by the Internet.

Justin Cantrell, owner and booker at The Shredder, the venue at the center of the 2012 local controversy, generally pays bands from the cover charge at the door. The great hazard of that model, of course, is that there is no guarantee anyone will come through the door--especially on the off nights that bands often come through Boise.

The Facebook post that began this article came from just such a night.

"It was a Sunday night, they [Killing for Peace] didn't bring a person through the door and it was a Portland [Ore.] band [headlining]," Cantrell said.

And even when there are people coming through the door, Cantrell said his goal is to make sure the touring band gets enough cash to fill its gas tank.

One of the best ways to do that is to keep the door price low; but that also means less money for the band. On the nights when he pays a flat fee for a band--which he does several times a month--it can run anywhere from $200 to $500.

Most nights, Cantrell said a touring band can pull around $100 from the door and selling merch, but if he had to pay every band that played on his stage $100, "I wouldn't be in business," he said.

Cantrell told BW the economics might be different if he sold liquor at The Shredder, but the expense of getting a liquor license in Boise makes that extremely difficult. A liquor license recently went up for auction in Garden City with a starting bid of $75,000. In Boise, licenses can reportedly cost more than $100,000 and require years of waiting.

For Cantrell, who lives in a small rented house on a noisy downtown street and who built most of the interior of The Shredder by hand over the course of more than a year, that's not a justifiable expense.

Still, he is emphatic that The Shredder's business model is not exploitative.

"It helps them [bands] out in the long run," he said. "If you're a local musician and you're not planning on touring at all, then the next best thing is to open up for touring bands. That's the only way you're going to get your name out there, other than pushing yourself online."

Billy Thornock, guitarist and singer for local thrash-metal band Krystos, agrees wholeheartedly.

"Paying local bands is not a part of the business model for The Shredder," he wrote on the Facebook thread that followed the controversy.

"The Shredder is designed to support and pay the touring bands. Just how it should be. ... As a local band playing at The Shredder, the opportunity is not in the pay, but in networking with signed and touring bands, developing a relationship with them, and they will support your Boise band on tour."

Thornock also gave several examples of how its policy of playing many an unpaid gig at The Shredder had helped Krystos on the road.

"People do talk on tours," Cantrell said. "A touring band meets up with another touring band and asks, 'Hey, do you know any bands to play with in Boise, or a cool spot to play?' If you've played with that band and you kind of sparked their interest, of course, they're going to say something."

Cantrell is also quite clear that he has nothing against local pros who do demand a paycheck to play--even the ones who won't play his club.

"That's fine," he said. "That's not what I'm trying to do."

Since he started out booking shows in his basement, Cantrell said that his primary goal is to push music and performers whose work he likes.

"Even doing house shows, I'd get all these bands that are huge now," he said. "I'm not trying to be some big rock club. I just enjoy good music."

Keeping on Keeping on

To the outside observer, it may seem dubious to build a business model on the idea of not paying certain workers in the operation. But there isn't a coordinated effort by clubs or promoters to defraud artists. Most promoters arise from local music scenes and genuinely feel for performers who leave their club with a handful of bar peanuts. But it is a complicated industry with tight profit margins, lots of moving parts and no shortage of emotional entanglements. In short, it's something of a clusterfuck.

However, one club that does things differently is Humpin' Hannah's. Its longtime soundtrack, The Rocci Johnson Band, is made up of salaried subcontractors with weekly paychecks that earn them around $20,000 a year.

"Anyone that has ever worked for me has always been fairly paid," said bandleader Rocci Johnson. "But I do work you. I'm a boss."

Johnson isn't kidding. Her band rehearses regularly and performs three nights a week, 49 weeks a year, almost, gasp, like a real job.

Before Johnson and company got to this point though, they were embroiled in the same complicated and inconsistent system of payment.

"We used to be a road band," Johnson said. "At that time, in the '80s, people wanted to pay you with coke and stuff like that."

Unsurprisingly, Johnson likes this better.

"I'm not just a musician,"she said. "I'm a business person. So for me, it was better to have it be more formal. I keep all my receipts."

Paying gigs like Johnson's are often the result of performers operating more like tradesmen. Though no one in her band is a member of a musician's union, and no one that responded to BW's survey was, either, that is the sort of treatment unions demand for their members.

There is however a tradeoff that comes with that switch from art to craft.

"There are drawbacks to it," said Johnson. "I have to play 'Sweet Home Alabama' every night of my life."

A tragic fate indeed.

Another group of performers who are paid consistently--but without having to endlessly channel the ghost of Ronnie Van Zandt dissing Neil Young--are orchestral players; however, with a financial pinch affecting orchestras around the country, those artists are facing complications emblematic of the challenges faced by the performance industry as a whole.

A recent article in Boise Weekly (BW, News, "Rhapsody in Red," Feb. 20, 2013) examined how the Boise Philharmonic found itself so deep in red ink that it couldn't afford to pay the musicians required to play several Wagner pieces it had scheduled.

Even in good times, it doesn't pay that well.

To cover the bills, Kyla Davidson, a 25-year-old Boise Philharmonic cellist, trades her tuxedo for a parka four days a week to work at Bogus Basin Mountain Recreation Area. She has also taught music lessons, played private gigs and tended bar.

But just to keep her part-time gig as a member of the Philharmonic, Davidson must spend up to five hours a day practicing and reviewing recorded pieces of music--all of it unpaid. And that non-paying work is impacting her health.

"I have thoracic outlet syndrome," said Davidson. "Sometimes my fingers go numb. It's a repetitive stress injury from practicing so much."

To complicate matters, despite performing with the Philharmonic for six years, Davidson is not eligible for health insurance because she is paid per-service--despite the fact that the wear of practicing has required physical therapy for years

"I'm still lucky enough to be under my parent's health insurance plan, which has made the therapy possible," she said. "But that goes away in April."

Like so many talented and underpaid people in Idaho, Davidson knows that the sheer economics mean she won't be able to stay in Boise, even if she wants to. The only way Davidson says she can truly make a living is to score a gig with a major orchestra like those in Boston, New York or San Francisco--jobs which rarely open and sometimes have upwards of 1,000 applicants when they do.

For now, she expects to start bartending again once Bogus Basin closes for the season.

One place she could apply is The High Note Cafe, the new venue DeVino proposed in his online comment last year. (DeVino has no actual financial or organizational relationship to the cafe.)

The small eatery on Fifth Street in downtown Boise isn't quite that utopic, though. It regularly features acoustic acts on weekends, and has, on a few occasions, moved out the tables to bring in a full-band electric performance. The louder and larger touring bands that play The Shredder aren't likely to be found on High Note's calendar.

Payment-wise, staff at The High Note told BW that on one or two occasions, musicians who performed at especially profitable nights got a cut of the bar, their ideal system. But for the most part, performers have been paid in food and beer if they have been paid. Unlike Amanda Palmer, The High Note Cafe has not offered to pay in hugs or high fives.

For Cantrell, the nature of the shadow economy is such that sharing the wealth is made impossible simply because there simply isn't any wealth to begin with.

"You'd have to have a pretty good amount of people even at $5 [at the door] to be able to pay a touring band, and then each local band as well," said Cantrell. "And lately, it's been kind of so slow that you have to have three locals for each touring band just to get a crowd out."

And that is the heart of the issue: to pay everyone simply means less music. And no one, not the venue owners, the fans or the musicians want that. So everyone keeps on keeping on the best they can.

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