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PERFORMER INSURANCE

The author asserts his right to publish this information in the public interest
No responsibility is taken for consequences resulting from using any information contained herein

FACTS AND FALLACIES ABOUT INSURANCE FOR ENTERTAINERS

Many performers and musicians are completely unaware of their responsibilities and liabilities in their workplaces, Unfortunately, some entertainment industry employers and agents also do not have much of an idea of this and some have been demanding that performers take out certain types of insurance that in many cases is not required. The following information may be of assistance to all parties involved in the entertainment industry.

PUBLIC LIABILITY INSURANCE

Since the advent of huge compensation payouts awarded in the courts, there has been much talk about performers having to take out public liability insurance. A lot of the information regarding this issue has just been wrong and many performers are compounding the problem by circulating misleading information. A number of agents in NSW are also doing the same and are also demanding that performers must be covered by their own public liability insurance.

I believe that the truth of the matter is very simple. Although self-employed people, such as sole traders and partnerships, should really take out public liability insurance just to protect themselves not only in the performing area but elsewhere, all venues that invite people onto their premises are legally liable for any damage or injury that is caused to those people.

ALL VENUES HAVE A DUTY OF CARE FOR EVERYBODY ON THEIR PREMISES

For example, if a performer is booked to perform at a club, this constitutes an invitation to enter the club's premises, therefore the club must accept responsibility for the safety of that performer and the activities that he conducts. If any mishap should occur that involves that performer, then the club's public liability insurance should cover such events and be liable for any compensation awarded. If by some chance the club does not have such insurance, then the club is still liable to compensate the victim from its assets. However if performers commit acts of negligence, then they can be found personally liable for damages and courts have made such rulings in the past.

THE BEST REASON FOR HAVING PUBLIC LIABILITY INSURANCE

Probably the best reason for performers to hold public liability insurance is to cover them at times when they are not at venues and thus covered by them. For instance, if a performer was unloading his PA and musical equipment from his car onto the street outside a venue and a person fell over it and was injured, then that performer could be successfully sued for damages if a court found that the injury was caused by his negligence in creating an obstruction. Therefore to protect themselves at times when they are not at venues, performers would be very wise to hold public liability insurance.

PERFORMERS SHOULD AVOID HAZARDS

There are certain circumstances where performers should take extreme care so as not to invite personal liability. For instance, many performers operate curtain opening mechanisms at venues, which is quite commonplace. However if the entire curtain hardware collapsed and injured people on stage, if those performers were not specifically authorised to operate the curtain opening controls, but took it upon themselves to do so, then a court of law could easily find that they were liable to pay any damages resulting from such accidents. The best way for performers to avoid such problems is to not operate any equipment that is not actually their own.

In my opinion, if public liability insurance for performers can be obtained at a reasonable fee, then it is worthwhile to be covered in any respect, as in these days of enormous litigation costs and multimillion dollar payouts awarded by the courts, to face a massive compensation debt that would destroy any entertainer is just not worth risking. Furthermore such insurance will cover the performer in situations outside of venues, such as if a person were to be injured as a result of falling over a performer's equipment when it was being unloaded on a public footpath.

Of course another good reason for performers carrying such insurance is that some venues may not book performers that do not have their own public liability insurance because they have been advised to do so. The ludicrous aspect of this is that if a claim is made for an injury suffered on venue premises because of the activity of a performer, even though the performer may have his own public liability insurance, this will not protect the venue against the claim being made against its own policy.

WORKERS COMPENSATION INSURANCE

This is an area where most performers are being misled by venues and agents that simply do not know the law or the requirements. Some agents now insist that all performers obtain workers compensation insurance when there is absolutely no legal or any other requirement to do so. Some venue consultants are even claiming that performers who are not Proprietary Limited companies cannot obtain such insurance and are trying to bill their venues an amount to cover a blanket workers compensation policy on every performer that they book. In my opinion this is ridiculous, totally unjustified and unnecessary. Furthermore it is not true that such insurance cannot be obtained by a private individual, as I have held such insurance when building my house for a period of nearly four years and I was not such a company, but merely a private owner-builder.

Here are the facts, taken straight from the NSW Government Workcover Subcontractor's Statement. The first part of the statement is a declaration by the subcontractor, notifying a principal contractor (the employer) of his details and the type of contract work involved. This is very straightforward, however the rest of the declaration reveals the truth of a subcontractor's liability for workers compensation insurance.

The subcontractor has to state that he has employed or engaged workers or subcontractors during the above period of this contract or if this is not the case, the subcontractor is an exempt employer for workers compensation purposes.

Note 6 on the back of the form states that for Workers Compensation purposes an exempt employer is an employer who pays less than $7500 annually, who does not employ an apprentice or trainee and is not a member of a group.

So it is easy to see that unless performers actually employ others on a payroll or engage other subcontractors, then they are not required to hold workers compensation insurance. Unfortunately some venues and their entertainment agents are misleading performers by insisting that they be covered by such insurance. Some agents have even tried to bill venues for a blanket workers compensation policy, when this is totally unnecessary.

My suggestion to performers is that if they do not employ workers or subcontractors and venue consultants demand that they hold workers compensation insurance, that such a demand be refused. The people making such a demand should be referred to the actual law and the requirements contained within. Pointing out Note 6 on the back of the Subcontractor's Statement should be more than adequate. It is nonsensical and most unfair that some agents are intimidating performers into taking out expensive insurance when they do not require it.

There is a further requirement for subcontractors who employ workers to pay payroll tax and ensure that their employees are paid, however this is not relevant to those subcontractors without employees, such as most performers operating in NSW.

SOME AGENTS MISLEADING VENUES AND PERFORMERS

One interesting factor that has emerged is that some agents and venue consultants are claiming that they are holding workers compensation policies that cover the performers that they book. Workers compensation insurance covers employees, however the Entertainment Industry act specifically prohibits agents from being employers. Therefore any workers compensation policy held by those agents cannot possibly cover the performers they book, simply because those performers are not employees of those agents. Venues need to be aware of this.

SOME VENUES ARE USING COERCION BASED ON WRONG ADVICE

Even worse, some venues, having received erroneous advice about protecting themselves against liability, are now stating that performers who are sole traders or are in partnerships will only be booked for engagements if they become companies (Pty Ltd) and be employees of their own companies so they can legally obtain and be covered by workers compensation insurance. This is very unfair and completely unjustified, simply because such a situation would not absolve venues from their legal liability or duty of care to anybody on their premises. This sort of fallacious policy will deny many performers the opportunity to obtain engagements unless they submit to this ridiculous demand.

Click here to open the Subcontractor's Statement in PDF format in a new window
SICKNESS AND ACCIDENT INSURANCE

As with the other forms of insurance, some venue consultants and entertainment agents are demanding that performers take out sickness and accident insurance. This is not only unfair and unwarranted, but none of their business.

Sickness and accident insurance protects people from loss of earnings if they are incapacitated by an illness or accident. In the entertainment industry, whether a performer is covered by such insurance is no business of any agent. If a performer wishes to take the risk of income loss if injured or ill by not having sickness and accident insurance, this is entirely his own choice and does not affect any agent or club.

I believe that sickness or accident insurance is strictly a matter for the individual and should not be made a condition of being booked by an agent or venue. Such a demand is intrusive and unwarranted and should be refused.

CONCLUSIONS

I have come to the following conclusions as they relate to performers.

I sincerely hope that this has helped to clarify the whole insurance debate, but legal advice should be sought in any dispute.