Film Accounting Glossary
Payroll company
What is a payroll company?
Also called payroll service, or entertainment payroll company.
A payroll company is the specialist service that processes production payroll, calculates union fringes and overtime, remits taxes, files returns, and usually acts as employer of record for the crew.
Using one transfers the compliance burden of temporary multi-state, multi-union employment to a firm that does it continuously. The production still owns the accuracy of the timecards, deal memos, and cost coding it submits.
Example
The payroll company calculates overtime under the right union agreement, computes pension and health per hour, remits federal and multi-state taxes, files the returns, and issues the W-2s. The show still owns the accuracy of the timecards and coding it submits.
Figures are illustrative, chosen to show the mechanics rather than to quote market rates.
Where you'll see it
Engaged before prep, usually as employer of record for the crew. The single largest external dependency in the accounting department.
Common mistake
Assuming the payroll company owns accuracy. It calculates from what the production submits, so wrong timecards and wrong coding produce wrong payroll on time.
Related questions
- What does an entertainment payroll company do?
- Calculates union overtime and fringes, remits taxes across states, files returns, issues W-2s, and usually acts as employer of record for the crew.
- Why do productions use a payroll company?
- Because temporary, multi-state, multi-union employment carries a compliance burden that a specialist firm handles continuously and a production office cannot.