By Steve Laube
Before I became a literary agent I had no idea how much energy this profession spent being a “collections agent.” Recently someone asked us the following questions (use the green button to the right to ask your question!):
What do you do, as an agent, when a publisher does not pay advances on royalties on time as per their legal contract?
What if a publisher is consistently late (months) saying they have cash flow problems and will pay when they can? Shouldn’t authors be able to count on getting paid the amount and on the date stated in their contract?
Is this common and is there anything that can be done or said regarding what seems to be a breach of contract?
This is an excellent series of questions. The full non-answer is “It depends.” Generally publishers are very good about making the payments according to contracted schedules. The above situation is much more dire and is a good reason to have an agent who knows how and who to talk to inside the publishing house. There are ways to approach the situation that gets results, just remember, “Don’t Burn a Bridge.”
However, there are a few possible reasons that authors should keep in mind before getting impatient with a tardy paycheck.
It’s in the Mail
Many contracts give the publisher 30 days to make a payment. And some will take all 30 days to generate the check. Note that some organizations write checks on Fridays. And if they missed their post office cut off, the check won’t be mailed till the next Monday. Then it depends on the speed of the mail service in your area. There have literally been times too many to count where a client has called me impatiently awaiting their check…and the check arrived the next day. Please remember to consider holidays and mail travel times when marking your calendar.
Your Work is Not Yet Finished
Most contracts have a second advance payment due on the acceptance of a completed manuscript. The key word is “acceptance.” The is not the same as “delivery” of the manuscript. Instead it means the editor has to run the manuscript through its paces to determine that it is indeed the book you promised to write. A few publishers will not declare a book “acceptable” until the entire editorial process has been complete and the book is ready to send to the typesetters. This can be months after the book was originally delivered. (I recall one situation where a manuscript was delivered in April and the “acceptance” money did not arrive until November.
Why is this? Because the publisher should be able to know that what you have written is sellable. There is a famous 1996 case where Random House sued actress and author Joan Collins. The publisher attempted to make her pay back her $1.3 million advance alleging that the manuscripts she had delivered for two books were unpublishable. Collins won, and kept her money, because the original contract only said that the manuscript should be ‘complete’ – not satisfactory. Her agent had somehow convinced the publisher to allow that language in the contract! I can guarantee that mistake would not be repeated today….
Click to view a clip from the actual Joan Collins trial.
And here is a PDF of the actual Joan Collins contract.
The Editor Forgot to do the Paperwork
In my early days as an editor I was terrible about this. Since I was the one who would declare a manuscript “acceptable” it was up to me to generate the payment request. There were a few times where I simply forgot. I finally got smart and delegated the task. Once a book was past a certain point in the editorial process, our managing editor would create the paperwork and I would sign off. Problem solved. But because of that experience I keep tabs on this for our clients. A gentle nudge is usually sufficient to get things rolling.
Your Publisher May be Cash Poor
For some publishers (usually much smaller ones), cash flow trouble is a reality. Back in the heat of the economic crunch in 2009 a publisher wrote to tell me they did not have the money to pay an “on signing” payment. They had been hit by huge returns and the banks were not extending credit back then. (Read this blog post about returns and their negative affect on the economics of publishing.) The author and I appreciated being told and the humble way in which the news was given. The money did arrive within 30 days, tardy but it was all there. Fortunately that was a temporary thing and has not happened again.