The Nuts & Bolts of Contracting with an Agent

Agency contracts are not the same as publishing contracts and it’s important not to confuse the two.

All professional authors have to sign contracts. Whether it’s publishing a column like this one, a short story for a literary journal, or a full-length book, every author will have to sign on the dotted line to get their work into print. Many authors also work with agents to help guide their careers and run the business side of the enterprise. If you engage an agent, you’ll end up contracting for her services, too. Agency contracts are not the same as publishing contracts and it’s important not to confuse the two. This article explains the nuts and bolts of contracts with literary agents.

These contracts are, legally speaking, pretty simple animals: usually no more than two or three pages, and the key terms are largely standard. Generally, the author is appointing the agent to represent whatever works are covered by the agreement—it can be all works the author creates during the term of the arrangement, or may be limited geographically, or to particular markets like fiction, nonfiction, children’s literature, etc. The term of the agreement is also typically pretty simple. Some agency agreements are for a set period of time (e.g. six months, one year), but usually, after that initial period, either party can cancel the contract with notice to the other. (Again, the notice period can vary, but typically it will be between a couple of weeks to a month.)

The agreement also sets out the commission the agency will take on for deals they negotiate for you. For standard domestic deals, an agent’s commission is usually between 10% and 15% of the royalties, but if the agent engages a sub-rights agent for, say film/television or foreign/translation rights, it can be higher because the agent is splitting the commission with the sub-agent. Note that where the publisher pays you an advance, the agency will take its commission from the advance because that payment is an advance on the royalties you might earn from the book.

Agency contracts are not the same as publishing contracts, and it’s important not to confuse the two.

Some particular issues worth noting about agency contracts include:

1. Your agent works for you. It is very easy to get the sense that agents have all the power and the author has none (and this is true to some extent). But bear in mind that you appoint the agent to sell your work. Legally speaking, the agent is your representative in the publishing world, not the other way around. If you do not like your agent’s approach or your goals don’t mesh well, you should seriously consider seeking alternate representation. Changing agents is not the end of the world and can be preferable to staying in a bad client-agent relationship.

2. Your agent does not own copyright in your work. Your agent’s job is to broker deals with publishers. If she succeeds, you will assign aspects of your copyright to the publisher, not to the agent. The agent has a right to her commission, but not to your copyrights.

3. The agency will likely take commission on deals they have brokered for you in perpetuity. This often confuses people, but it is fairly standard in agency contracts for the agent to continue taking commission on deals she has brokered during the entire commercial life of the project even if you leave the agency. Some agency agreements also entitle the agent to commission on works you sell within a certain period of time, say six months to a year, after leaving the agency where that agent has contributed significant editorial or other work to the project.

4. Your agent will use “best efforts” to sell your work. The agency contract usually says something along these lines and, as a fiduciary (under principal/agent law), this duty is implied even if the contract does not spell it out. However, the contract will not likely specify what “best efforts” entails. You should always talk to an agent before signing about how they prefer to work in terms of editorial input, how many editors they will send work to, how often they will update you on submissions and in what format, etc. Do not rely on the contract for those details.

5. Your agent should answer your questions about the contract. While an agent is not obliged to change any contract terms for you—some agents will negotiate with you, others won’t—any reputable agent should answer questions you might have about them. If an agent is not prepared to explain a contract term, that might be a red flag.

Ultimately, if you are uncertain, confused or have a bad feeling about the terms offered by an agent, there is no downside to seeking advice from an author’s organization like the Authors’ Guild (if you’re a member), volunteer lawyers for the arts, or an attorney or contracts consultant working in the publishing area. If an agent is rushing you to sign without advice, that may be a red flag too.

And of course, nothing written here is intended as formal legal advice, but hopefully this information is helpful if you are mulling over a particular agency contract, or thinking of doing so in the future.