How Often Should Royalties Be Paid?

Q. Is there a commonly accepted schedule of royalty accounting and corresponding royalty payments? My publisher does its accounting only two times a year and sends that accounting and royalties to the author five months after the end of the reporting period.

A. Most trade publishers prepare author royalty statements twice yearly, for the January-June and July-December periods. Most academic publishers generally do their accounting only once a year, which is something that authors of those books should always seek to change to twice yearly when negotiating their contracts. A handful of very small publishers do accountings (and pay royalties) more frequently, some even monthly.

A twice a year accounting and payment schedule is generally considered fair by most publishers and authors. Similarly, sending the royalty statements and paying the required amounts three months after the end of each royalty period is relatively standard and considered reasonable by most publishers and authors. Not paying royalties until the fifth month after the end of the reporting period is outrageous and unfair to authors (and, disappointingly, standard practice for at least one major publisher). Holding an author’s money that long is simply a crass way for a publisher to, in effect, borrow money from an author at zero interest. Publishers that refuse to make royalty payments until 120 days or longer following the end of a reporting period should be embarrassed by the practice and pressured by adverse publicity to change that policy.

(Originally published in the Fall 2006 issue of the Authors Guild Bulletin. © Mark L. Levine)

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