Well it's all about a profit margin. They have these companies that are multi ops and are interested in the most profit they can make from events. A lot of them will look to pay a very small amount of money to a DJ to do an event that the company has booked. A lot of time the pay is so low that it's a wonder that they can get a DJ to agree to do the event. Usually they will find a cheap desperate DJ to do the job and some insist you use your own gear or you can't work for them.
If I remember correctly there was a company called Solid Gold that was in business for many years and had a horrible reputation with paying DJs and getting a DJ to do an event for a client after getting paid. I understand they filed for bankrupcy and owed a ton of money to DJs and clients. People in court trying to get their money. Once they filed nobody could collect any money. I say the mistake those DJs made in dealing with this company would be to first check them out completely before agreeing to work for them and I say since I don't know them personally and never worked for them, I would look to have gotten paid ahead of time before doing the event. Not waiting till after the event is over to get paid. We're talking a business arrangement with somebody I don't know and not person friends I've known for years and know the money is good.
Solid Gold (and operators like them) are NOT "multi-ops." They are Two-steppers.
A
Two-Stepper is someone who makes a contract with one person and a second contract with another person to deliver upon the terms of the first. The lack of employer/employee relationship is not known to the customer unless or until something goes wrong. They subsequently look to the Two-stepper for a resolution but, of course he has none because he was never involved in the actual service to be delivered. Two steppers are simply passing the torch once they've acquired the cash.
Two-steppers are people pretending to be an agent, or agency but, in fact are not licensed or bonded as may be required. Most U.S states require agents to be licensed and bonded as a legal means of consumer protection. Those not licensed or bonded are deemed to be Two-steppers and depending on what state you are in - two-stepping may be actionable as fraud.
This is different from a legally licensed and bonded
Booking agent that represents TALENT (usually as a sub-agent) rather than customers and discloses their role as a seller's agent to engage the sought after talent. The agent fee is independent of the talent fee, even where it may be a percentage, and liability may be limited to securing the contract rather than the performance. Booking agents get paid to produce a contract between the talent and a given buyer. They are not responsible for the actual performance.
Multi-ops and
Talent groups differ from booking agents where they assume responsibility for providing the talent from their own pool of employees, or contractors. They can be buyer's agents representing the customer in a transaction with talent (contractor), or a service provider - but in both cases they are responsible for a
specified performance.