By Greg Pak
Please note that this article was written in 1999 — since then, SAG has updated its contracts and to become even more friendly toward independent projects. This article is no longer up to date — filmmakers are HIGHLY recommended to contact SAG to learn about the new contracts.
There will be times when you cannot cast your micro-budgeted film properly without using SAG actors. But if you have hopes of marketing and selling your short film, I strongly urge you to use non-SAG actors if at all possible.
Here are the reasons why:
SAG, or the Screen Actors Guild, has an Experimental Film Agreement (for productions with a budget under $75,000) which many low-budget filmmakers sign in order to use SAG actors. As with all SAG contracts, the producer must adhere to SAG rules (regarding hours worked, etcetera) and must provide worker’s comp. The twist is that the Experimental Agreement allows the producer to defer salaries to actors until the film is sold.
The Experimental Agreement is a good, even generous deal, but if you’re making a short, the reality is that you’ll never make any money if you sign this contract and use SAG actors.
Here’s how it works: Say you shoot one day, with two SAG actors. You owe them about $600 each, payable upon the sale of the film. That’s $1200. Which means that when you’re offered $300 by a local PBS station to screen your film, you’re contracturally obligated to pass those dollars directly to your actors.
Here’s a real world example:

To make “Mouse,” I shot for five days with two actors. I believe the SAG rates at the time were around $575 a day with a weekly rate of $2000… So I would have owed my actors a total of $4000, had they both been SAG.
Over the past two years, I’ve sold “Mouse” to four local PBS shorts anthology series, one Japanese satellite television station, and the International Channel’s Asian American Film Festival, for a grand total of about $3750. Had my actors been SAG, I would still be paying them off and would not yet have earned a dime toward reimbursing my $8000 in production expenses.

An even more extreme example:

I have a friend who made a 30 minute film with some 20 SAG actors. His deferred SAG bill must clock in at over $100,000. His film has been very successful on the festival circuit and won a number of awards. But no one will ever pay him enough to pay off that incredible SAG bill.

Do not misconstrue this article as a diatribe against SAG: SAG is just doing its job, looking out for the pocketbook interests of its members. And for a feature film, which has the potential to make a good deal of money in distribution, the Experimental Contract represents an honest and helpful effort by SAG to make it possible for low budget filmmakers to make good films.
Furthermore, there are other SAG agreements which might be more to your liking — the Limited Exhibition Agreement has its advantages and disadvantages. Depending on your project, you might also want to look at the Low Budget Agreement, the Affirmative Action Low Budget Agreement, and the Modified Low Budget Agreement.
Finally, SAG actors are frequently excellent — you may find during casting that the perfect actor for the lead in your film is SAG.
So be it: if it makes your film a better film, cast SAG. I merely counsel filmmakers to be aware of the consequences: as soon as you cast a SAG actor in a short film, you most likely surrender any hopes of making your money back and thus inhibit your ability to distribute the project as extensively as you might like.
You make the call.
Relevant contact information:
SAG’s New York office: 1515 Broadway, 44th Floor, NYC 10036, 212-827-1510
SAG’s Los Angeles office: 5757 Wilshire Blvd., LA, CA 90036, 213-549-6828