Hollywood guilds flex their muscle as union influence declines nationwide

The entertainment industry marches to the tune of box-office receipts and TV ratings, but the chorus of union pride can still be heard loud and clear at the highest echelons of corporate Hollywood.

As union membership continues to decline nationwide, Hollywood remains a bastion of organized labor, with unions controlling nearly every aspect of production, including the director who calls “action” and the truck drivers who transport equipment to and from sets. Their power can bring the film and TV industry to a standstill — the Writers Guild of America came close to striking last week, only to reach a last-minute deal with the studios.

The agreement underscored the leverage that unions still possess in the film and TV industries and highlighted a new wave of labor unrest. As viewers migrate away from traditional broadcast and cable to consume content on digital platforms, entertainment guilds are fighting to keep up with changing modes of compensation and to safeguard hard-fought benefits, like generous healthcare plans.

SAG-AFTRA is set to begin its own contract negotiations this month, with talks expected to focus on such issues as residuals for streaming services including Netflix and Amazon. The actors’ union is already several months into a strike against major video game companies. SAG-AFTRA is seeking a new compensation structure that would allow actors to start receiving residual-like payments on a game’s commercial success, but game companies have balked at the demand.

Two factors account for the prevailing power of unions in Hollywood, according to Harley Shaiken, a professor and labor economist at UC Berkeley.

“They command a strategic resource — creative talent — and they bargain effectively,” Shaiken said. But elsewhere in the economy, “the defining narrative of the union today is declining membership and they remain very much under attack.”

Last year, the share of American wage and salary workers who were members of unions fell to 10.7%, down from 11.1% in 2015, according to the Bureau of Labor Statistics. Union membership hit a high in 1954 at close to 35% of all U.S. wage and salary workers. The drop is attributable to various factors, including the decline in manufacturing and the waning influence of unions in construction.

But in Hollywood, virtually all personnel involved with movie and TV production are union members. One major exception is reality TV, which often uses non-union crews and performers. The WGA has tried to organize several popular reality shows but has faced pushback from production companies. Other unions, notably the International Alliance of Theatrical Stage Employees, which represents technical workers on film crews, have had more success unionizing reality TV shows.

The Hollywood guilds have maintained their dominance even as the major studios have come under control of major media conglomerates. Their longevity is due in part to a unique culture in which guild membership is highly coveted — a sign that you’ve arrived.

“It’s a badge of honor, a badge of status,” said Brian Walton, a former executive director of the WGA who has been a negotiator for SAG. He said the guilds have successfully built a sense of community among their thousands of members and are an established industry presence.

Members also have financial motivations for remaining loyal to their unions: Combined, they receive an estimated $2 billion in residuals each year, Walton said. Each guild negotiates its own contract with the studios.

Fights over compensation typically erupt during periods of technological disruption, which have included the rise of TV in the ‘50s to the advent of cable and home video in the ‘80s. With streaming services now dominating the industry, the guilds have become more aggressive about staking their claims on revenue from new digital platforms.

When cable and DVDs emerged, “the guilds made deals that they later felt were insufficient given the growth of those areas,” said Ivy Kagan Bierman, an entertainment labor attorney at Loeb & Loeb. “So the guilds are very focused on making sure they negotiate provisions that will be beneficial for their members” in areas including streaming and the Internet.

In upcoming contract talks, SAG-AFTRA will follow successful negotiations led by the WGA and the Directors Guild of America, both of which achieved increases in streaming residuals. The guilds have historically engaged in pattern bargaining, in which the gains made by one are used as leverage for the others.

The focus of the SAG-AFTRA negotiations “will be on coming to a mutual agreement as quickly as possible,” Bierman said. “I’m not anticipating it will hold a threat of a strike over these companies. I think SAG-AFTRA understands the devastating effect that strikes have had on the industry.”

SAG nearly staged a strike in 2008, but its efforts were badly hampered by sparring with its sister union. The 2012 merger with AFTRA has created more unity — and potentially more bargaining clout for actors — though the current leadership is considered more pragmatic than the faction that led the union during the previous standoff.

Major labor strikes in Hollywood history include the WGA’s walkouts in 2007 and 1988, which lasted 100 days and 155 days, respectively. Commercial actors went on strike in 2000 for six months over residuals.

Union leaders often argue that strikes — or threatened strikes — deliver new gains for members.

“We were able to achieve a deal that will net this Guild’s members $130 million more, over the life of the contract, than the pattern we were expected to accept,” WGA negotiators said last week.

The Hollywood guilds rose to power at the height of the old studio system, when actors were treated as little more than studio chattel, often made to work grueling hours. Writers and directors were also seen as interchangeable cogs in the Hollywood machinery.

Historically, the guilds have had an antagonistic relationship with the studios, dating to the 1930s. Moguls such as Walt Disney, Louis B. Mayer and Irving Thalberg were openly hostile to unions, which they saw as a front for communism.

Today, studio bosses recognize the role of unions and occasionally intervene to keep the peace, as was the case last week when the WGA negotiated a last-minute agreement to avert a strike. The tentative three-year contract must still be ratified by members.

While popular in Hollywood, unions remain politically divisive nationwide. Only 44% of Republicans say they have a favorable opinion of labor unions, while 76% of Democrats hold a favorable view, according to a recent report from the Pew Research Center.

In February, a Republican-backed bill was introduced in the House of Representatives that would introduce right-to-work laws nationwide, thereby allowing workers to choose not to join a union in companies covered by union contracts.

Members of the WGA condemned the bill, saying it was an attempt to “crush” the labor movement. “Strong sturdy unions are essential to organize workplaces,” WGA East President Michael Winship and Executive Director Lowell Peterson said in a statement.

President Trump, who drew large support from blue-collar workers, supports right-to-work laws. “He wants to give workers and companies the flexibility to do what’s in the best interest for job creators,” White House Press Secretary Sean Spicer said in a February briefing.

In recent years, the Hollywood guilds have worked hard to maintain visibility in the industry through efforts that have included regular email communication with members and their annual red-carpet awards ceremonies attended by A-list celebrities.

The official rhetoric is often inclusive and reassuring, even in the midst of a contentious negotiation. Last week, the WGA praised its members after reaching a tentative agreement with the studios after several weeks of talks.

“That result, and that resolve, is a testament to you, your courage, and your faith in us as your representatives,” the guild’s negotiating committee said in an email to members. “Your voices were indeed heard.”

david.ng@latimes.com

@DavidNgLAT