Successor Symphonic Media and Film Agreements Finalized

February 25, 2015

Ray Hair  -  AFM International President

The Federation concluded negotiations for a successor Integrated Media Agreement (IMA) and also for successor Motion Picture and Television Film Agreements (Film Agreement) in late December 2014 and early January 2015, respectively.

The IMA covers the production and exploitation of electronic media for orchestral musicians who work under locally negotiated symphonic, opera and ballet agreements, and is a successor to an initial IMA that came about in 2009. It is also the successor to previous orchestra media agreements—the Symphonic AV Agreement, the Symphonic Live Recording Agreement and Internet Agreement.

The Film Agreement dates back to the early1930s. It was the first industry-wide trade agreement ever bargained by a US labor union.  First negotiated with the Hollywood studios in the aftermath of the rise of the “talkies,” the agreement established wages and conditions for the studio orchestras after the synchronization of recorded scores for motion pictures revolutionized the film industry and replaced movie house pit orchestras throughout the world virtually overnight.

The path to finalizing successful and progressive agreements with orchestra employers and film producers was lengthy and difficult. Our symphonic media negotiations took place with a newly formed association of employers (“Employer Group”) representing some 70 institutions and encompassed nine rounds of bargaining that took place in Chicago and New York beginning December 16, 2013 and concluding December 18, 2014, a full year after negotiations began.

Negotiations for the Film Agreement took place in Los Angeles at the headquarters of the Alliance of Motion Picture and Television Producers. There were six rounds of bargaining that stretched over more than two years, from November 2013 until agreement was eventually reached a few minutes after midnight January 10, 2015.

To say that these symphonic media and film industry negotiations were “tough” is an understatement. I will summarize the substance and results of the negotiations below, and I am proud to say that the Federation’s Negotiating Teams were steadfast, resolute, and indefatigable in their resistance to unreasonable employer demands.

In the IMA bargaining, we were faced with an all-out assault on existing wages and conditions of employment for symphonic media. The Employer Group’s opening proposals contemplated a world in which they could record every service without compensation, and then exploit those recordings in any and all media platforms without restriction, without upfront payment, and indeed, without any compensation at all (other than a limited share of any net revenues that might result from the exploited media).

The Employer Group also sought “unconstrained business opportunities,” and made no bones about the fact that they were proposing to undercut terms and conditions enjoyed by freelance musicians working under Federation sound recording, motion picture, television, jingle, and videogame agreements. In short, the employers wanted to use orchestra musicians from locally bargained agreements to create a runaway shop in order to divert work from freelance musicians and provide cut-rate recording services to global, billion-dollar companies.

After a year of fierce struggle, the Employer Group finally realized its demands would never be accepted and withdrew nearly all of their insidious proposals. Highlights of the new IMA, which extends to June 2017 are as follows:

• Supremacy of Federation Jurisdiction. The Employer Group has acknowledged Federation jurisdiction over electronic media covered by the Federation’s media agreements, ending a multi-year effort by assorted orchestra employers to subdue and eliminate national media standards.
• Preservation of Upfront Media Payments. The Employer Group eventually abandoned its effort to totally rewrite the existing agreement and impose its demand to be granted unlimited media rights for free.
• Strict Limits on Recording with Nonclassical Artists. The Employer Group acknowledged that the IMA is intended to facilitate media production and exploitation for the benefit of the orchestra institution and its musicians, and not for the purpose of providing content to commercial third parties. They acknowledged that recording projects with nonclassical artists are subject to the applicable nonorchestral Federation media agreements (such as the SRLA, Basic Theatrical Motion Picture and Television Film Agreement, and so on), unless otherwise permitted by the Federation.
• Promotion. The 2015-2017 agreement provides new tools for promotion—and implements clearly defined new limits on promotional activities like donor gifts and individual volunteer activities.
• Pension Increase. The pension contribution rate is increased to 12%.
• Streaming of Local Radio Broadcasts. Local radio broadcasts remain covered by local CBAs, but the Federation’s jurisdiction over streaming of those broadcasts is affirmed.

I’d like to thank the members of the ICSOM and ROPA media committees, numerous local officers, Jay Blumenthal and Debbie Newmark from our Symphonic Services Division, AFM Counsel Trish Polach, and also rank and file representatives Matt Comerford (Chicago Lyric Opera and ICSOM Media Chair), Steve Lester (Chicago Symphony), Peter Rofé (Los Angeles Philharmonic), Fiona Simon (New York Philharmonic), and Carla Lehmeier-Tatum (New Mexico Philharmonic and ROPA President) who joined Debbie, Trish, Jay and me for the closing round of negotiations late last year.

The film negotiations opened over two years ago against a backdrop of unrest in the Los Angeles recording community concerning   implications about residual payments made under the agreement through the Film Musicians Secondary Market Funds (FMSMF) and the amount of work done in the US and Canada under our Agreements—much of it fueled by false statements engineered by employers, composers, and their booking agents who are seeking to undermine the hard-fought gains the Federation has made over decades of bargaining. Despite the significant impediments encountered along the way in this negotiation, we eventually reached an agreement with progressive economics that will extend three years, through April 2018.

There were three main issues that held our attention throughout the negotiations—FMSMF, Banking and Exchange, and Clip Use, and I will summarize the discussion about those issues below.

From an economic standpoint, payments from FMSMF far outstrip payments to musicians for original sessions. In 2013, for example, reported session wages to musicians under the agreements was around $10 million, while distributions from the FMSMF were around $80 million. Every film musician understands that there are two major components to musicians’ employment and compensation—original session work and distributions from FMSMF, which are deferred compensation for work performed in making a movie in the first place.

And at the outset of the bargaining we learned about a disturbing trend. Composers and their “teams”—including their booking agents and sometimes aided by the employers themselves—began to use FMSMF as a “candy jar” to reach into and get the long bucks on the back end by gaming, distorting, and inflating their upfront compensation in order to obtain outsized and unwarranted FMSMF distributions.

The economic conflicts that flow from this arrangement are immense.  The composer needs musicians and has to pay them rates required by the agreements. But in any prenegotiated “package deal” the booking agent has done with the film producer, musicians’ wages eat into what is left for the composer, his team, and his booking agent.

What happens is that the composer “pretends” to pay himself and his team for performing bargaining unit work that is never actually performed and never actually paid for. It is reflected on session forms  submitted as “Benefits Only,” or “Pay Direct,” or some other phrase that says to the payroll service: “don’t write this person a check because he was paid the applicable scale directly, but do make pension and health benefit contributions for him.”

Why does the composer do this? It’s because the greater the supposed compensation for bargaining unit work, the greater the share of the secondary markets distribution his team will obtain even though they did not actually do the work on which those distributions will be based.

So the higher the wages the composer and his team report for themselves for work they claim to have done under the agreement, the higher their FMSMF distributions. We uncovered numerous instances of “pay direct” reports for films with an inordinate number of session reports reflecting sessions that simply could not have taken place as reported, for films with reports reflecting music prep work far in excess of what would be expected given the amount of music in the film, and for films in which persons who are not musicians are included in the reports.

To the extent that composers, their teams, their booking agents and our employers are participating in this scheme, it is plainly improper—some might call it fraudulent. Given the importance of FMSMF distributions to the overall compensation of musicians, and the emergence of this scheme to take money rightfully belonging to someone and pay it to someone else, issues surrounding the FMSMF were prominent in this round of bargaining up to the very last hours of the negotiation.

The Federation and the producers agreed that abuses must be curbed and would be addressed and resolved through an ongoing internal Fund process. And, importantly, we included language that specifically allows the withholding of distributions while any alleged abuse is under investigation.

A second critical issue was “banking and exchange.” For many years the Film Agreement has contained a provision requiring that any motion picture produced in the US or Canada, if scored, must be scored in the US or Canada under the agreements. Over the years, the Federation and the producers lived under an arrangement under which a picture that was not required to be scored in the US or Canada (in most cases because it was produced outside of the US or Canada), but was scored here nevertheless, could be placed in a “bank” and then later “exchanged” for a picture that would be required to be scored here but that the producer wanted to score outside the US or Canada. That arrangement was memorialized in what became known as the Banking and Exchange procedures.

For a variety of reasons, the application of these procedures created differences and sore points between the producers and the Federation and those sore points had to be fixed. Suffice it to say that, like any negotiation, neither side got exactly what it wanted from the fix, but we believe we are all better served by having the certainty of quite specific contract language rather than the ambiguity of procedures that created unnecessary friction.

The use of clips of music unaccompanied by film footage was the third major issue of this negotiation. Currently, the producers are limited to using a maximum of two minutes of recorded music without accompanying footage in any other motion picture. Over at least the previous three rounds of bargaining, the producers have sought to increase the amount of music that could be “clipped,” and the Federation has resisted on the ground that expanding clip use into motion pictures that would otherwise require live scoring cuts down on employment. In this agreement, we reached a compromise that should meet the producers’ stated objectives while protecting the use of clips from encroaching on employment.

Other features of the new film contract include raises in session pay of 2% per year over the next three years, sideline rates contained in the agreement will now be applicable for high budget new media productions, and cartage rates were increased by 33%.

Sincerest thanks are in order to the many talented musicians, the members of the IEB and local union officers who spent countless hours working on these negotiations. I would like particularly to thank the small group we put together as the “closing” negotiating team during the last days and nights of negotiations: Local 47 President John Acosta, Local 257 President and IEB member Dave Pomeroy, Local 802 President and IEB member Tino Gagliardi, RMA President Mark Sazer, and rank-and-file representative Phil Ayling. As usual, we had the benefit of Bredhoff & Kaiser’s superb representation through Federation General Counsel Jeff Freund and his colleague Anne Mayerson. Last, but surely not least, my thanks to the hardworking Federation staff for their valuable contributions.

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