President’s Message

As I write this column (March 12, 2021) the $1.9 trillion American Rescue Plan, with its relief provisions for multiemployer pension plans, has passed the Senate, was approved by the House of Representatives, and was signed into law by President Biden. If there were ever a day to celebrate the power of collective action and concerted activity, to pay tribute to grassroots political organizing, to unionism and the determination by organized labor to protect and improve the lives of tens of millions of workers and preserve the dignity of retirees, today is that day.

When the Butch Lewis Emergency Pension Relief Act of 2021 was introduced by House Ways and Means Committee Chairperson Richard Neal (D-MA) and was included as part of the larger COVID-19 supplemental bill (now known as the American Rescue Plan), I huddled with Federation National Legislative Director Alfonso Pollard and asked him to head up an “all hands on deck” Federation-wide lobbying effort to help keep the pension provisions in the omnibus supplemental bill, and then push the final legislation across the goal line.

Alfonso and his team rose to the occasion. Our voices, and those of other union members, were heard. AFM members, active and retiree participants, and employers in the American Federation of Musicians and Employers Pension (AFM-EP) Fund will feel the positive effects of the American Rescue Plan for many years to come.

Despite the deeply divided partisan attitudes in Congress toward the American Rescue Plan, 61% of Americans supported its passage. It includes direct stimulus payments and supplemental unemployment benefits—all desperately needed by out-of-work musicians and performers who may be the last to return to work when the pandemic eventually recedes. It also sends billions in aid to hard-hit state and municipal governments to offset COVID costs and to provide help with delinquent mortgage payments, back rent, and utility payments for the jobless, including struggling gig workers.

Passed under the leadership of Senate Majority Leader Chuck Schumer (D-NY), House Speaker Nancy Pelosi (D-CA), and their leadership teams of Richard Neal (D-MA) and Bobby Scott (D-VA) in the House and Patty Murray (D-WA) and Ron Wyden (D-OR) in the Senate, the American Rescue Plan contains a number of provisions that provide substantial relief to multiemployer pension plans that have been adversely impacted by the COVID-19 pandemic, including the AFM-EP Fund. Employer contributions to our Fund have been decimated by job losses from government-imposed pandemic-related shutdowns caused by an abrupt halt in employment in the live entertainment industry last year.

The COVID crisis increased the urgency for pension relief. It has been estimated that absent this critical legislation, millions of Americans would have eventually lost significant percentages of their retirement incomes. Thousands of businesses would have been forced into bankruptcy costing tens of thousands of workers their jobs.

But for participants in our pension fund, the American Rescue Plan, with its embedded pension fund assistance, could not have been adopted a moment too soon because it eliminates the need for benefit reductions. The legislation creates a new special program of financial assistance at the Pension Benefit Guaranty Corporation (PBGC) to provide troubled plans with funds needed to pay full, unreduced participant benefits for 30 years (until 2051).

We want to thank every senator and member of Congress that voted to adopt this important legislation. These lawmakers knew what we needed. They knew what we were up against, and they chose to help professional musicians and the working people of our country. We all also owe a huge debt of gratitude to all of our Federation officers and staff for their steadfast support, and particularly Alfonso Pollard, who designed and oversaw AFM’s massive lobbying effort that mobilized thousands of members and Fund participants to contact Capitol Hill during the crucial weeks leading up to final Congressional consideration. That effort brought together Director of Organizing Michael Manley, Lead Organizer Alex Tindal Wiesendanger, and player conference heads John Michael Smith (Regional Orchestra Players Association), Meredith Snow (International Conference of Symphony and Opera Musicians), Marc Sazer (Recording Musicians Association), and Tony D’Amico (Theatre Musicians Association), who together spearheaded a Zoom call outreach, targeting support from lawmakers in key congressional districts.

While we rejoice in this historic legislative success, we are also mindful of our responsibility as a union to protect the Fund from future shortfalls by negotiating increased employer contributions in successor collective bargaining agreements. To do that, we have to get back to work. Still, no one can say with any degree of certainty when social distancing restrictions will be lifted, or when our various communities will be deemed safe enough to risk reopening our performance venues so that professional musicians can begin to recover from the disruption of this pandemic.

But when you are back on the concert stage, in the theater pits, in the arenas, restaurants, and clubs, performing in venues of every size and shape, please remember that the American Rescue Act protected your pension. It happened because of Unity. We never took our eye off the ball. We elected lawmakers who cared about us, and they had the courage to act. Unity is our power. In Unity there is strength.

Participants in the American Federation of Musicians and Employers’ Pension Fund were notified in January that the Fund filed a second application with the US Treasury Department to reduce benefits under the Multiemployer Pension Reform Act (MPRA). This month, I’ll explain the decision by the Fund trustees to file another MPRA application, the difference in this application from last year’s, and where we are with this year’s application.

I’ll also discuss the all-out lobbying efforts by the Federation and the Fund to mobilize rank and file and participant support for the Butch Lewis Emergency Pension Plan Relief Act of 2021, which would eliminate the need for benefit reductions and provide the Fund with enough money to pay benefits for the next 30 years. Unions have been lobbying hard for pension relief legislation for years. We are very hopeful that soon, with the support of the new Biden Administration and a new Congress, legislative relief will finally become a reality.

Previous Application

The trustees filed an MPRA application on December 30, 2019, which was denied because Treasury disagreed with two actuarial assumptions related to mortality and new entrants into the Fund. We considered our options and decided that, without pension relief legislation, the only way to save the Fund was to file another application soon, for the same reasons as we decided to file last year. We re-filed on December 30, 2020.

Reason for Filing

Without a reduction in benefit payments, or a pension relief bill, the Fund will eventually run out of money. All that would be left for retirees would be amounts payable by the federal insurer, the Pension Benefit Guaranty Corporation (PBGC). As the law now stands, that would amount to about $12,800 a year for a participant with 30 years of service. Also, under PBGC rules, the benefits of all pensioners can be reduced, even if you’re 80 years of age or older. But, even worse, the PBGC itself is projected to run out of money by 2026, which would mean that the benefits of participants in insolvent plans would be reduced to almost nothing. That’s why MPRA benefit reductions are a better option than insolvency.

Changes from Last Year’s Application

The second application has the same design as the previous one. A notable difference is the size of the flat reduction for multipliers other than $1, which went from 15.5% to 30.9%. The reason for the increase in the reduction is the advent of COVID-19, which caused an abrupt halt in employment in the live entertainment industry and led to a substantial reduction in employment in media production.

Despite the Fund’s strong investment performance during the pandemic period—the Fund returned 17.1% from March 1, 2020, to December 31, 2020, which beat our benchmark (and it returned 32.3% in the first nine months of its fiscal year, from April 1, 2020, to December 31, 2020)—employer contributions have been decimated by job losses from government-imposed pandemic-related shutdowns. From April to September of 2020, the Fund received about $22 million in contributions, compared to about $48 million in 2019.

With the arrival of vaccines to help prevent the spread of the virus, we are hopeful that the economy and the entertainment industry will recover sooner than it would otherwise. Nonetheless, we are projecting that employer contributions will be substantially reduced for several years. The dramatic pandemic-driven decline in employer contributions entirely upended our original projections
and led to the increase in the flat reduction percentage.

Benefit Reduction Design

Just as with last year’s application, the trustees were determined to make the cuts as fair as possible and were also determined to protect the $1 multiplier, the core promise of the Fund. In addition, the trustees recognized that participants who had worked more recently already had huge cuts to their pensions due to the reductions of the $4.65 multiplier to $1 and the elimination of the early retirement subsidy and other subsidies.

Faced with these painful reductions, the trustees developed a plan to apply reductions as equitably as possible by eliminating the early retirement subsidy, and the re-retirement and re-determination benefits. The trustees decided to retain the cap on anyone’s benefit reduction at no more than a 40% reduction. There are other statutory protections for older and disabled retirees.

Retiree Rep

You might also remember that the trustees appointed Brad Eggen as the independent “retiree representative” to advocate for the interests of retired and terminated vested participants and beneficiaries. Brad is a 50-plus-year member of the AFM and is the current president of the Twin Cities Musicians Union, AFM Local 30-73 in Minneapolis-St. Paul, Minnesota. He and his “equitable factors panel” of several retired participants from different parts of the industry will communicate directly with participants concerning the pending MPRA application. Brad has retained his own independent lawyers and actuaries to assist in assessing the application.

Pension Legislation

But MPRA cuts may not be necessary. Immediately following President Biden’s inauguration, House Education and Labor Committee Chairperson Bobby Scott (D-VA) and House Ways and Means Committee Chairperson Richard Neal (D-MA) introduced pension relief legislation to save troubled multiemployer pension plans like the AFM-EP Fund. The bill was then revised and introduced as the Butch Lewis Emergency Pension Plan Relief Act of 2021, as part of the larger COVID supplemental relief bill, a priority in the new Congress. With Democrats controlling the White House and both houses of Congress, the bill has a far better chance of becoming law than any prior legislative attempt to address the multiemployer pension crisis. By the time this column reaches your mailbox, the bill may have already become law.

The COVID-19 economic catastrophe has increased the urgency for legislative multiemployer pension relief. According to Congressman Neal, pandemic-driven job losses and the related reduction in employer pension contributions could cause an additional 180 multiemployer plans to become insolvent, “bringing the total of plans facing failure to 300 plans covering 2.5 million participants.”

This new bill is structured differently from the original Butch Lewis Act that was introduced in 2019, but, like the prior version, we believe it would eliminate the need for the AFM-EP Fund to apply for benefit reductions. The bill would provide the necessary funding through the general fund of the US Treasury to permit the Fund to pay all of its liabilities through 2051. The trustees of the Fund are studying the new bill with our actuaries, and if it is as good as it looks, and it passes, the trustees plan to withdraw the pending MPRA application and apply for pension relief.

Visit http://ow.ly/e89L50DBZ2Q to review the congressional legislative summary of the new Butch Lewis Act.

The Federation is all-in with other unions in the campaign to enact the new Butch Lewis Emergency Pension Plan Relief Act. Please join with the hundreds of AFM members who are contacting their legislative representatives by following the links in our email blasts and at www.afm.org as we coordinate the push to renew the health of the AFM-EP Fund and protect all participants.

On January 7, I issued the following statement in the aftermath of the mob attack on our capitol:

“The American Federation of Musicians of the United States and Canada condemns in the strongest terms the mob assault upon the US Capitol building, which was an attempt to subjugate our democracy and the peaceful and constitutional transfer of power after a lawful presidential election. The attack resulted in desecration, injury, bloodshed, and death in a place that is a symbol of hope and unity.

“For the sake of our democracy, we urge the immediate end to the incitement of politically motivated violence and we pray for the restoration of order. We implore members of Congress and all other elected officials to speak out against violence in all forms. We ask that all involved in this unconscionable attack be held accountable. 

“We thank law enforcement for keeping our elected officials and their staff safe. We urge everyone, everywhere, to stand together for democracy and the rule of law and against political violence.”

In the weeks, months, and years ahead, we will see how the earth-shattering events of January 6, 2021 in Washington, DC, will be treated. At the very least, the incident will be seen as infamously as 9/11 or the Kennedy assassination. On January 6, we watched the arsonists fan the flames of disunity, division, divisiveness, and dangerousness, all in service of political ambition.

Despite the horror of the destruction, looting, injury, and loss of life at the hands of armed insurrectionists intent on hunting down elected officials and staff, people continue to push the lies that led to the mob attack on our democracy. Web chatter abounds and the FBI has confirmed that violent threats have been made about recreating the incident to coincide with Martin Luther King Day on January 18, and with armed protests on Inauguration Day on January 20, not just in DC, but at state capitols in all 50 states. Washington Mayor Muriel Bowser urged citizens to stay away from DC during President Biden’s inauguration, as protesters and hate organizations continued to promote terrorism and violence rather than the peaceful democratic process as a platform to settle political differences. Some wonder whether the attack on the Capitol was the end of the violence or the beginning of ongoing terroristic threats against Congress.

David Gergen, a political commentator and former adviser to four presidents, referred to January 6 as a “naked moment,” affording a rare open window into an embedded toxic legacy of white supremacy and racism in our society. I believe you can draw a straight line from January 6 all the way back to the conclusion of the US Civil War and forward through the reconstructionist aftermath of southern race riots, the establishment of Jim Crow laws, the Tulsa Massacre of 1921, the Ku Klux Klan, its resurgence in the 1920s, 1950s, and 1960s and its lethal violence toward Blacks and Jews, the John Birch Society, the 2017 Charlottesville riot, and the recent police killings of unarmed Black people.  While the US Civil War ended 150 years ago, the violence and the seething hatred beneath it all has not. It has survived attempts at reconciliation to remain a platform for ambition.

Have we entered an era where politicians place their political ambitions above the safety and welfare of our democracy, our institutions, and even the lives of our elected officials? Does the fomenting of disunity and division as a means of political control, and the anger, hatred, and spectacle that result from it, improve our government, our security, and welfare? We are watching raw, naked political ambition and the use of violence in pursuit of political power, not for the people, but for the acquisition of power itself.

What kind of politician would give voice to violence, violate their oath of office, and sacrifice the institution, its constitution, rules and laws, and the lives and livelihood of those who elected them to serve, all in the name of power and ambition?

The events of January 6 and the continuing threat of armed political warfare could not come at a worse time, against the background of a surging COVID pandemic, a slowdown in vaccine distribution, rampant unemployment, and the transition to a new pro-labor administration that holds promise for working people, and our union. In the face of this wave of political violence and disruption, never have we needed steady leadership, political stability, good governance, unity, and strength more than we do today.

At stake and at risk in our political process is the health and longevity of the American Federation of Musicians and Employers’ Pension Fund (AFM-EP Fund). Omitted from last year’s mid-year and year-end Congressional COVID relief bills were proposed legislative solutions including the Butch Lewis Act that would have restored the financial health of critically underfunded multiemployer pension funds, including AFM-EP Fund, with long-term, low-interest government loans. Under the proposed legislative relief, there would have been no benefit cuts for participants.

With a new administration and a new Congress with a Democratic Senate majority as a result of the Georgia January 5 runoff elections, the odds of adopting a meaningful pension relief package have risen dramatically. The lives of thousands of our members and retirees depend on legislative success. That success necessarily depends on bipartisan support for a healthy democracy and the prevention of governmental collapse.

Political chaos and rioting in Washington, DC, and across the country will not help make our lives better. Neither will the ambitions of politicians who would sacrifice their institutions, the rule of law, and their constituents’ welfare for the advancement of their own self-serving political interests. It’s bad for the country. It’s bad for the union, too.

The American Federation of Musicians congratulates President-elect Joe Biden and Vice President-elect Kamala Harris for their victory in the November 2020 general election. Our union endorsed the Biden-Harris ticket because their campaign agenda promoted the protection of American workers, and committed to strengthening worker organizing, collective bargaining, and unions.

As I’ve mentioned in this column previously, there has been an all-out war against unions and collective bargaining for decades, and which accelerated after President Reagan broke the Professional Air Traffic Controllers Union (PATCO) in 1981. More recently, state governments have binge-legislated anti-worker laws, including so-called “right-to-work” laws to favor union-busting agendas to sabotage labor unions, organizing, and collective bargaining.

The Biden campaign labor platform, if implemented as promised, may result in the most pro-labor atmosphere of any administration since the presidencies of FDR and Harry Truman. President Truman, as students of history may recall, vetoed the Taft-Hartley Act of 1947, which sought to restrict and weaken the power of unions (as it certainly did), but his veto was overridden by Congress. In the years since, the expansion of union-busting corporate power over working people has multiplied exponentially. 

Over the last four years, an anti-labor biased National Labor Relations Board has produced a parade of rulings that look to hurt unions and to reverse the progress made during the Obama years. Joe Biden proposes to check the abuse of corporate power over labor by holding corporate executives personally accountable for interfering in organizing efforts and for labor law violations. He also proposes to restrict federal dollars to employers who engage in union-busting activities and would penalize companies that bargain in bad faith.

And on an issue that particularly and directly impacts the business of freelance professional musicians who struggle to survive in the gig economy—pandemic notwithstanding—Joe Biden supports extending the right to organize and bargain collectively to independent contractors. This is a point of paramount importance for our union because the employment status of musicians performing short-term engagements for multiple employers is routinely and unfairly determined by labor boards to be that of an independent contractor.

Independent contractors do not have recourse under the National Labor Relations Act when unfair labor practices are committed against them by purchasers of their services. In many cases, because of their pattern of employer conduct and strict control over the services of musicians, the purchasers and also the booking agents are de facto employers and should be held subject to labor law jurisdiction.

A good portion of the Biden labor platform can be accomplished through executive orders and a re-alignment of National Labor Relations Board appointees. Some platform pieces will need Congressional approval and are likely to meet resistance if the Republicans maintain control over the Senate. By the time you read this column, we may know the outcome of US senate runoff races in the state of Georgia, which could impact whether the full extent of Biden’s pro-union agenda, as well as other critically important items, may be implemented. 

Two top Federation legislative priorities in the new Congress concern the urgent need for relief for critically underfunded multi-employer pension plans, and long overdue amendments to copyright law to provide for a terrestrial performance right. These two items were under Congressional consideration in the form of the Butch Lewis Act—which would guarantee low interest loans to troubled pension funds, including the AFM pension fund, eliminating benefit reductions for participants—and the AM-FM Act, which would require US radio stations to pay musicians, singers, and copyright owners for the music they use.

The Butch Lewis Act is part of the relief recipe for struggling multi-employer plans now embedded in pending COVID-19 supplemental relief legislation, in the form of Emergency Pension Plan Relief Act of 2020.  While we do not expect any year-end congressional relief package to include pension relief provisions, we do expect early 2021 COVID relief legislation to include a rescue package for multi-employer pension plans.

Republicans have indicated they will push for a smaller-scale compromise plan that would be paired with benefit reductions. The Federation will fiercely resist such an inadequate solution and instead lobby hard for a broader stimulus package that would include pension relief provisions designed to shore-up multi-employer plans, restore benefit reductions already implemented, and preclude the possibility of prospective benefit reductions.

The new Congress will also see the introduction of successor legislation that would establish a performance right in terrestrial over-the-air radio broadcasts, requiring radio stations to pay musicians and singers, as well as major and indie labels, for the use of recordings. Gone are the days when radio play promoted the sale of physical products such as vinyl records, tapes, and compact discs, that drove artist royalties and label income. With streaming services such as web radio, satellite radio, and interactive services such as Spotify and Apple Music acquiring a greater percentage of consumption and growing bigger piles of money, especially during the pandemic, labels and performers are pushing to get paid on terrestrial radio play.

Because Joe Biden has promised to be “the most pro-union president you’ve ever seen,” I am optimistic that the Federation’s legislative goals, those of our arts and entertainment union partners and all of labor, are far more achievable today.  But if Republicans continue to control the Senate, there will be serious challenges. That’s why Georgia’s twin runoff elections on January 5, 2021, which will decide the political tone of the Senate, are so important.

The American Federation of Musicians will work with the Joe Biden administration to promote, encourage, and incentivize unionization, to adopt legislation to protect our pension fund, to further beneficial copyright and performance rights legislation, and to promote initiatives that will improve the lives of musicians everywhere.

I am pleased to report that on October 22, 2020, after years of false starts, interruptions, and delays, the Federation reached agreement with representatives of CBS, NBC, and ABC for a successor Television Videotape Agreement, subject to ratification by the members.

Negotiations for this agreement spread over four years. The previous agreement expired on February 2, 2016, but was extended indefinitely pending a successor agreement. These negotiations presented some of the most difficult challenges the Federation has ever confronted. From the beginning, we faced employers who refused to bargain over streaming residuals, who wanted to reach an agreement that simply was unfair to musicians. Network representatives never really wanted to make meaningful improvements to our livelihoods. When they eventually relented and agreed to discuss streaming residuals, the employers attempted to deny coverage to a large segment of the bargaining unit—guest artists, background musicians, and music preparation personnel—proposals we would never accept, and which we roundly and soundly rejected.

Our rank and file members and negotiating team hammered home repeatedly the fundamental inequity of their refusal to pay streaming residuals to musicians—residuals they pay to members of other talent unions—and their failure to ensure that musicians will qualify for continuous health care coverage. Buoyed by extensive concerted activity, we persevered and reached an acceptable agreement. While we did not accomplish all our objectives, we did make considerable progress.

Although we have not achieved full parity with other unions in residual streaming, we did succeed in obtaining new contract language providing for a residual when content from live television programs is exhibited on an advertiser-supported streaming-on-demand (known as Advertising Video on Demand, or AVOD) platform after a seven-day free window. Despite fierce resistance from the networks, the Federation fought to ensure that all musicians involved in production of streamed shows—including house bands, guest artist musicians, back-up musicians, and music preparation personnel—would receive an additional 2% of the program rate for each of two 26-week periods of streamed exhibition. After expiration of two 26-week periods, musicians will receive a pro-rata share in 1.2% of the streamed program’s AVOD receipts.

In addition, the networks agreed to apply the contract’s regular wage and benefit rates to services performed on certain High Budget Subscription Video on Demand (SVOD) programs, ending the insidious practice of free negotiation. If ratified, wage rates in the agreement will be increased by 2% each year for a three-year term. Health and welfare daily contribution rates will increase by $5 in year one, and by an additional $5 in year three. The networks also agreed to increase their contributions for paid permanent download content from 1% to 1.5% of 20% of distributor’s gross for the first 100,000 units, and from 1.9% to 2.9% of 20% thereafter. Another new feature is payments to the AFM and Employers’ Pension Fund on an unallocated basis for licenses to secondary digital channels. These improvements are significant. The new AVOD residual language is a fundamental, structural contract change that can be improved upon in future negotiations. Moreover, this deal will result in long overdue wage increases that are compounded by the new AVOD streaming payments.

The path to this agreement was arduous. The networks put up every roadblock they could. In the face of this reality, our approach was steadfast in protecting the contributions our great musicians make to the television industry and pragmatic toward seeking new benefits for our constituency and our pension fund. While we have a long road ahead and much more progress to make, this comprehensive package addresses a number of critical issues, not the least of which is the wage stagnation of the past several years owing to the networks’ refusal to negotiate and provide streaming residual counterproposals. We had to fight long and hard to get serious discussions on streaming started at all. Once that happened, and when musicians from our shows hit the street and generated heat, the pieces began to fall into place.

I cannot praise too highly the solidarity, hard work, and enormous time investment of all the musicians in the #RespectUs campaign. Actions included wearing #RespectUs facemasks at their workplace, NYC rally and march, and helping to get public recognition for the contract from late night hosts James Corden and Stephen Colbert. Without the actions from members fighting to win a better contract, we would not have won what we did. 

We benefitted from the invaluable input and activism from Local 802 and Local 47 musicians who perform on the various late-night shows with James Corden, Stephen Colbert, Jimmy Kimmel, Jimmy Fallon, and Seth Meyers, as well as variety show musicians performing with Dancing with the Stars, The Voice, and Saturday Night Live. Numerous freelance bargaining unit musicians participated in Zoom meetings and negotiations. We were also assisted by local union officers Ed Malaga (IEB and Washington, DC Local 161-710), Terry Jares (IEB and Chicago Local 10-208), Pat Hollenbeck (Boston Local 9-535), Andy Schwartz (New York Local 802), Rick Baptist (Los Angeles Local 47), Dean Rolando (Chicago Local 10-208), and Nashville RMA representative Danny Rader.

I offer my most sincere thanks to the members of the Federation’s negotiating team, which consisted of International Vice President Bruce Fife, Vice President from Canada Alan Willaert, Secretary-Treasurer Jay Blumenthal, International Executive Board members John Acosta (Local 47 Los Angeles) and Dave Pomeroy (Nashville Local 257), RMA President Marc Sazer, and rank and file representative Jason Poss, with assistance from AFM Counsel Jennifer Garner and Russ Naymark, EMSD Director Pat Varriale and Assistant Director John Painting, Contract Administrator Mary Beth Blakey, Organizing Director Michael Manley and Lead Organizer Alex Tindal Wiesendanger, Communications Director Antoinette Follett, and Local 47 Organizer Jefferson Kemper.

We cannot afford to relax and ease the pressure. We will meet regularly with the employers to continue discussions concerning workplace issues and the equity we seek. Further contract improvements, particularly in streaming residuals, will likely result if we maintain and build upon the momentum of our fairness campaign.

Next up—the Sound Recording Labor Agreement, with our old friends, the major record labels.