Impact of the coronavirus: From Shah Rukh Khan to Ranbir Kapoor, Ayushmann Khurrana, Bollywood actors suffer a 20-40% pay cut
With film production halted, the film industry is the latest to join the movement to deduct wages in an effort to lower operating costs. According to industry estimates, leading players including Ranbir Kapoor, Ranveer Singh, Deepika padukone, which typically charges between Rs 20-35 crore per film, has reportedly suffered a 40-50% reduction in price, while actors such as Ayushmann Khurrana, Tapsee Pannu, and others have slashed their rates by 20% – 30%. These groups of actors charge between Rs 5 crore and Rs 10 crore. “The film industry is also facing budget restraint issues as we don’t know when theaters will reopen, but the cost of production will continue to rise as long as the film is on hold. So I think lower wages are definitely the new normal and negotiations are already underway, ”film critic and business analyst Taran Adarsh told BrandWagon Online.
When contacted, popular production companies owned by Karan johar, Rohit Shetty, is unavailable for comment.
Meanwhile, megastars such as Shah Rukh Khan, Salman Khan and Akshay Kumar, among others who are also co-producing their films, are renegotiating the deals. These actors typically charge between Rs 40 crore and Rs 60 crore, in addition to signing a profit sharing agreement. Typically, these megastars walk away with 40-50% of the profits generated by the box collected. In the current situation, these actors are now renegotiating where instead of charging a fee, they are allowed to keep only the profits generated by their films. For Komal Nahta, film critic and business analyst, it all depends on the budget of the film, the actor and the producers: one film he might just take a 40% cut for another or decide to forgo his salary altogether and to receive compensation only on the profits of the film.
Recently, the Producers Guild of India issued a statement highlighting the increased interest charges on amounts collected to finance films, which producers have to bear. To further reduce costs, production costs which include rental, the cost of equipment and the salary of technicians would also have been reduced by 5% to 10%. “The film industry operates on a gig economy structure, the majority of people working on a film are hired as freelancers rather than on a payroll. If production stops, they are not paid ”, Jehil Thakkar, partner, Deloitte.
Even though the Producers Guild of India and the government of Maharashtra have cleared the filming with guidelines in some states, it would still take about a month for production to resume. However, production companies may no longer go for lavish sets, slashing overall film budgets by 30-40%, as right now the focus is on keeping afloat.