Your Contract with a Literary Agent

Agents do a ton of work on the behalf of their author clients. They risk a lot of valuable time, along with money in the form of long distance phone calls, overnight mailings (sometimes), etc. So it's only natural for them to want some guarantee of renumeration -- otherwise they'd be hobbyists and not businesspersons.
To secure their rights, every agent/agency will either ask the author to sign an agency agreement up front or will add a clause to the end of every publishing contract they negotiate that spells out the specifics. If an agent offering you representation works on a "handshake" (as many do), you should ask to see a copy of the clause it adds to book contracts. If you don't, you risk being put in a terrible position -- trying to negotiate that clause, if needed, while the agent is trying to negotiate the best deal possible with the prospective publisher. Talk about an anxiety-ridden situation. ("If I make the agent mad by asking for changes to her clause, what is she says no? What if she gets mad and drops me? Will the publisher withdraw its offer? Will I have to start over with a different agent? What if I can't find one quickly?" And so on...)

Either the agency contract or the agency clause in the publishing contract names the agent as the "agent of record" and entitles her to her cut (usually 15%) of the proceeds. Most of the time, the agency clause indicates that all payments from the publisher are paid directly to the agent (who should get out a check for your 85% as soon as the publisher's check clears). A few agents and authors have something called split accounting, where the publisher sends the author her cut and separately sends the agent hers. Some agents are fine with this, but a lot of them will get upset if you even ask, since they feel they should be trusted with your earnings, as is traditional in the agenting world. I think this is fine, as long as your agent has a wonderful track record of being honest and timely in her payments. This is one good reason to thoroughly check on an agent before agreeing to representation. RWA, the Romance Writers of America, keeps a record of complaints against agents. Members can check them out by phoning the RWA headquarters in Houston. Or you can check out the Preditors and Editors website maintained by SFFWA or other online resources.

Most agency clauses assign the agent to act as the author's representative for matters relating to "this agreement" or contract. In other words, when the contract is over (i.e. the book goes out of print and the rights revert to the author), the agent who sold the book no longer has a claim to its earnings. The Author's Guild, the Romance Writers of America, Mystery Writers of America, and many other writers' organizations all agree that this is fair, but what's caused a huge controversy is the change in wording instituted by several large agencies (and taken up by others) entitling the agent to a cut "for the life of the copyright of the work" (that's your life plus seventy years) or, worse yet "irrevocably" . That's right: forever.

So what does that mean? Suppose your early books have gone out of print and you've parted ways with the agent who sold them. (Very few authors remain with the same agent throughout their career. Either they fire the agent, the agent goes out of business/dies, or the agent drops the author.) Later, you make a comeback and want your current agent to sell the rights. You do all the legwork on getting back your rights, and your new agent does all the work to re-sell the book. Without both of your efforts, the book would be dead in the water, making no one any money. So why should the original agent (or the original agent's heirs, since in the case of an "irrevocable" agreement, this could go on forever) be paid for work she/they did not
do? And why should you pay 30% of your earnings in two fifteen-percent commissions to two different agents? And once you've passed on to that great Slush Pile in the Sky, do you really want your heirs having to fight with the agent's heirs about this issue? (I'll bet Tolkien's grandkids are glad they don't have this to contend with.) Besides this, if an agency dissolves, there may be no clear successor, which
could tangle things in court for years.

Another tangle cropping up in some agency agreements/clauses has to do with options. When a publisher offers a contract, they'll almost always want the right of first refusal on the author's next work of the same kind. If the publisher wants that next book, it has to (usually, depending on the contract language) renegotiate a new deal with the author. Some agents/agencies are asking authors to sign contracts/clauses that entitle the agent to a cut of the option book. If the author's moved on to a new agent and has the new person negotiate the contract on the option book, this would mean the author would be obligated to pay both agents 15% of the take, leaving her only 70%. I feel that only the agent who negotiates the new deal should be entitled to a commission, but that's something you need to try to negotiate with your shiny new agent before the shiny and new wears off.

Only you can decide what's a deal-breaker and what isn't. But it never hurts to ask for information, explain your reasoning, and request changes in a business-like manner. If you're professional about it, nobody's going to get mad and stomp off in a snit. (And if someone does, who'd want to be stuck with this kind of agent anyway?)


bria said…
Thanks! This is great stuff to know now. Love your site, interesting combination of informative and fun.
Thanks for stopping by, Bria! We appreciate the kind words.