Once a signatory agreement is cemented with the union, the producer has essentially agreed on the union’s basic contract governing the rights of its members, and the important terms of a production’s budget, including pay, residual calculation and work hours, have been decided on. Additionally, the producer may need to heavily negotiate with a union for favorable conditions — a process that can involve heated exchanges between producers/studios and unions –– and the outcome of these discussions will determine the fate of the project in question.
Signatory productions are quite the norm in the United States, but this isn’t necessarily the case in the international arena. Indeed, the struggle over union control has gone global, and as big studios and unions vie for dominance, everyone has a lot to lose.
With more productions heading overseas, we are entering a new era for studio-union relations, one in which the rules are yet to be determined. Flashback to the recent two-month-long, fiery dispute between Warner Bros. (together with its New Line Cinema label and co-financier Metro-Goldwyn-Mayer) and Actors Equity New Zealand during the preproduction of Peter Jackson’s The Hobbit, a two-picture project originally set to begin in February 2011. The clash even roped in the Screen Actors Guild (SAG), which boycotted the production in solidarity with its “sister union,” advising its members not to work on the “non-union” production.
The row began when local actors attempted to unionize under Actors Equity New Zealand in order to achieve status as employees rather than independent contractors, thus entitling them to minimum pay rates and residuals –– something taken as a given in the United States. When SAG, together with six other unions around the world, issued a “do not work” order on the production, it was met with nasty assertions by producers that New Zealand production would move to Eastern Europe — a threat hardly taken lightly in a land that has thrived on The Lord of the Rings trilogy.
The scrap eventually fizzled out in November 2010, with SAG heading home with its tail between its legs and union power effectively diluted by national legislation pushed through in a single day at the behest of the colossal studio. This amendment to current labor law clarified that actors, crew and other production personnel in a production hired as independent contractors cannot later claim to be employees. Warner Bros. came away with an extra $25 million in production incentives from the country, and the government was able to secure an agreement to include a promotional tourism video on all The Hobbit DVDs. In New Zealand, actors don’t receive a minimum standards contract, so Actors Equity New Zealand had doubtlessly counted on this melee to be the spark it needed to jumpstart unionization in the country.
The blistering Hobbit fiasco may pale in comparison to the grisly battle for Middle Earth, but the stakes are just as high –– and the 2010 proxy war between Warner Bros. and SAG may point to increasingly savage production battles on the horizon.