Many of our clients have questions about using an entertainment payroll company (such as Media Services or Entertainment Partners) versus using a traditional payroll company (such as ADP or Paychex).Is it necessary? Is it cost-effective? What are some of the pros and cons?
Let’s take a quick look:
Benefits of Signing Up with an Entertainment Payroll Company
- Entertainment payroll companies become the employer of record, therefore allowing production companies to share the burden of liability.
- Most entertainment payroll companies provide their software free of charge, as long as you process payroll with them.
- This software ensures that data integrity is maintained (versus utilizing Excel or QuickBooks where user error and software limitations can potentially create frustrating scenarios).
- Industry standard cost and general ledger reports are available at the push of a button.
- Payroll information integrates into the software, saving the user time.
- Time consuming activities such as purchase orders and petty cash transactions are easy to track.
- Smaller production companies might not have the budget to absorb the additional fees assessed by entertainment payroll companies (specifically worker’s compensation and processing fees).
- Many entertainment payroll companies require a payroll deposit upfront, to ensure protection of their status as Employer on Record. Again this can be challenging when cash flow is tight.
- Setup and paperwork can often be time consuming and confusing.
The Bottom Line: Entertainment Payroll
While each client’s situation is unique, and costs are a big consideration, we recommend most secure an entertainment payroll company to ensure proper reporting and legal protection.
Let us know if we can help you navigate the often confusing world of payroll companies – traditional or entertainment specific!