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The Once and Future Strikes : Hollywood Labor Relations 101

The Once and Future Strikes : Hollywood Labor Relations 101

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The headlines seem never to end: "Producers make final offer," "Industry Braces for Possible Walkout," "Strike Threatens to Bring Hollywood to a standstill." etc. etc. etc. And for the past year or two right up to this week, the situation looks pretty grim in the "dream factory" here in LA-LA-Land.

And I was thinking …maybe you (who, unlike me, are NOT inside this industry and have only the fan press and TV entertainment nonsense reporting to give you clues) would like to know a little bit more about "Why For?" So here we go:

Though there are unions and guilds (never mind the distinction between 'em. That's next semester, okay?) that cover everything that can be done on or around the set of a movie, there are basically FIVE major ones that we need to pay attention to:

  • The Director's Guild of America (DGA -- Which covers Directors, Assistant Directors, Unit Production Managers, Associate Directors, Stage Managers, Production Assistants in live TV and Location Managers in the NY area)

  • The Writer's Guild of America (East and West -- WGAE/WGAW, but basically the same club. The DGA has offices in NYC and L.A. too, but just doesn't distinguish the names of the sub-groups that way)

  • The Screen Actors Guild (SAG -- ONE of the TWO actors unions -- the much larger one dealing more with filmed and pre-recorded material … sorta)

  • The American Federation of Television and Radio Artists (AFTRA -- the OTHER actor's union -- smaller, and more about live media, news personalities, variety shows, but often overlapping into SAG territory and often actors belong to BOTH)

  • The International Alliance of Theatrical and Stage Employees (I.A.T.S.E., or "The IA" as it is known-really an ALLIANCE of all the various craft and "below the line" folks such as camera, lighting, grip, sound, prop, costume, makeup, and other technical people who get the show down on film/tape/bytes etc. etc. etc.

THESE folks have contracts which specify their MINIMUM wages ("stars" and their agents and lawyers can always negotiate MORE, of course,) working conditions, rights, procedures to adjudicate violations, pension and health and welfare plans, safety issues, and a host of other particulars of the workplace. And these contracts are negotiated/updated/reformed every three years -- though not all together. They are staggered over various years so that not EVERYbody is fighting at once - -partially to avoid utter chaos and mostly because while there are FIVE groups above (and sub-negotiations within them-different contracts, for example in the DGA, for filmed entertainment, live and tape, network vs. non-network shows, etc. etc.) they are all talking to ONE entity on the other side of the table which can only meet with them individually.

THAT side of the game is the Alliance Of Motion Picture and Television Producers AKA the AMPTP. (NOT to be confused with its other incarnation as the Motion Picture Association of America --the lobbying group for the producers more like a trade association than a negotiating body but made up of the same major companies, nor with the various Academies that give out Oscars, Emmys etc. etc.)

So … Once upon a time, every three years or so, within a few months or weeks of the expiration of the current contract, the two sides (AMPTP and ONE or more of the various unions/guilds-whoever's contract was up next) would schedule meetings to negotiate a new deal, usually leaving a lot of the old one intact and just updating as needed the things that changes in production techniques necessitated, experiences during the three years that needed clarifying, and, of course, increases in wages and other payments.

Once an agreement is hammered out in a highly sophisticated form of horse trading mostly behind closed doors (I've been there/done that BTW on many occasions), the finished agreement that the union/guild representatives endorse is then presented to the full membership of the body for "ratification" -- a majority membership vote up or down, which, of course, the leaders tell their members they SHOULD endorse and vote up. IF they do not vote yes OR if the negotiation reaches an impasse and there's no deal to approve or disapprove of, the union/guild leaders will, instead, ask their members to vote on a "strike authorization" -- to give them the ultimate card to play in the negotiations -- the threat to shut the industry down.

But here's the problem: IF a studio begins production on a film or TV show close to the date of the end of the contract and IF there is NO agreement or if it looks like there might be a fly in the negotiation ointment, then producers are reticent to START anything because it costs SO much more to STOP in the middle and then have to re-start -- not to mention the much bigger financial cost of simply stopping and NEVER re-starting a movie or show and having to throw away all the funds already spent. Let's remember that the major studios are PUBLIC companies who have to answer to stockholders and regulators and must spend their money prudently … or not spend it if that makes more sense.

That's why (a) what's known as a "de facto" strike happens often -- production slows to a crawl or stops weeks before the contract deadline as a self-protection technique by the studios, and (b) why there's a lot of pressure to make a deal and, in recent years, to go negotiate much EARLIER than the last minute to make sure no such slow-down or stoppage happens so that nobody adds the insult of less income under the OLD contract to the injury of a strike instead of a new contract. We have seen some guilds go into "early negotiations" in recent years as much as 6 months or more prior to the contract's official termination deadline.

Remember, please, that strikes in Hollywood affect more than the many hundreds of thousands of us who work in the industry. Movie and TV folks are mostly freelance workers -- they are not on an annual or steady salary. When the show is shooting or working, so are they. When it isn't, they are not. And when NONE are working? Well, strikes-de facto or actual-- also affect our local shops, our dry cleaners, our mortgage bankers, our school tuition payments, and every other ripple-through in the local economy of this "company town" for the movie and TV biz that is Los Angeles.

The losses of recent strikes to the overall economy here have been measured in BILLIONS, not mere millions. And that includes the direct added expenses of starting things up again once everyone comes to their senses. The effects can last for YEARS -- especially for those who, in prior strikes, had mortgages foreclosed on, businesses that serve the industry fail, or even bankruptcies and divorces and other life-changing tragedies happen because a usually thriving industry lost its way and fell apart.

So what's going on right now? Simple: Even though all the unions and guilds go to negotiate in different years, there's usually an overall "issue" that's the "hot topic" of any particular period, and what usually happens is that ONE of the major unions makes a deal to solve that issue first and that becomes what's known as a "pattern of negotiations" that the other groups tend to follow. Because -- in most cases -- it makes no sense for the producers to give a lot MORE in the same area to one group over another. We also negotiate that SHOULD another Guild somehow get a better deal on an issue, everyone else will move up to match that level, too.

Rightly or wrongly, the issue at hand this time around has been "New Media" and the residuals paid on DVD's, pay-per-views, and all the other means of delivery such as streaming video, etc. etc. Many of the unions say the studios are making big bucks on these things and thus the percentage they share should go up. The studios, of course, say "Not so fast. We have higher expenses and we make a lot of flops that devour the hits. And besides, we take the risk by backing the shows. And we just plain think that the current percentage is fine & dandy." There are good and bad arguments on both sides. Lots and lots of them. Way too many to go into here. Trust me.

But, as it happens, the DGA made a deal on this (and everything else) and DGA members approved their contract. And after a pretty nasty & costly strike a few months ago that you certainly will remember from the headlines, so did the WGA. And now that its contract year has arrived, AFTRA has made their own deal. And SAG has been in negotiations on its contract over these same issues and ... Oops ! SAG has NOT agreed to the same basic "pattern" as everyone else. SAG's contract has in fact actually just expired a few days ago on June 30 without reaching a new agreement to replace it. But SAG has NOT asked its members to authorize a strike … yet.

BUT … approximately 40,000 members of AFTRA, who currently have their ballots in hand to APPROVE their negotiated agreement (and must do so by today, July 8th when the ballots will be counted and the results revealed) are ALSO members of SAG (which has well over 100,000 members). And that's where it has gotten really sticky.

You see, as a way of strengthening their bargaining position to get a BETTER deal (they think) the SAG leadership has asked its members who are ALSO members of AFTRA to vote "NO!" on the AFTRA contract. Even though the AFTRA leaders have asked their members to vote "YES!" and endorse the deal they negotiated in good faith with the producers. THIS has caused a HUGE battle amongst the actors with famous folks taking opposite sides, placing ads in the trade papers, giving speeches and press conferences, and generally going nutso (another highly technical labor relations term -- I'd love to explain, but this is already too long … So take your best shot and guess).

SOME say this "sabotage the AFTRA deal if you're also in SAG" plan is the only way to pressure the studios to offer SAG and AFTRA both a better deal that will benefit everyone when it becomes the "new" pattern. Others say that for AFTRA to have negotiated in good faith and then have SAG butt in and meddle in their vote and basically tell the producers they didn't MEAN it when they negotiated would not only weaken everyone but give the producers a really good reason to say "a pox on both your houses" and hold out for WORSE terms for the actors in both guilds.

So … Last week, the studios gave SAG a basic ultimatum -- "This is the last, best deal we will offer you. Take it or go on strike." And SAG has said "Well, gosh, we aren't ready to strike just yet or even ask our members to approve one -- We just want to see how the AFTRA vote comes out." And meanwhile, as all three groups fight and offer brickbats in the industry media, and as the DGA and WGA and IA wait to see what happens …

Just about everyone is NOT working because, as I explained, NOBODY wants to start up a show only to have it shut down by a strike. And EVERYbody is still hurting from the very recent WGA strike that shut the town down for months only a little while ago, killed the last TV season, and cost everyone in and out of the industry billions of dollars. Which, they fear, might all happen again. Soon.

SO…the possible results are that either

(A) AFTRA ratifies their contract and SAG realizes it can't do better and takes the deal and THEIR members ratify too and we all go back to work, or ...

(B) SAG succeeds in torpedoing the AFTRA deal and then one or both of these unions authorize a strike and the town shuts down which ...

(C) won't look a whole lot different than the defacto strike now happening due to the producers' shutting things down to cut their losses but will be a whole lot angrier and nastier and potentially could lead to ...

(D) producers saying "Screw you guys -- we'll hire NON-union actors and the big stars will walk away from you because they like their big paychecks more than they sympathize with a union of 100,000 waiters and shoe clerks who once upon a time got an acting job but have nothing to lose by striking and making everyone else in the business lose their butts."

Yep. It could get that ugly out here. So stay tuned and we'll see.

I know this was long. But at least now you have some context for what the usually-inept news media will be telling you about what's going on at places like Sony and Paramount and Fox and Warner Bros and Universal and … oh yeah, DISNEY right now. Namely, a whole lotta nothing and a whole lotta name-calling and a whole lot of anger and tension and fear.

Ain't showbiz glamorous? You bet it is. And while the outcome as I write this is truly unknown, at least, I hope, you have some basic background to filter the sometimes incomplete news reportage through ... Because, as a JHM reader, you now know a little better the answers to the famous question: "Why For?"

Questions? Ask.

DISCLAIMER: This is a SHORT and BROAD BRUSH STROKE portrait of a VERY complex subject. The Secretary will disavow all knowledge of my actions. Your mileage may vary. Do not remove tag under penalty of law. Etc. Etc. Etc.

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