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The First 21st Century Strike

January 14, 2008
Related Topics: Labor Relations, Featured Article
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Hollywood’s striking writers have had some major impacts on the entertainment industry, prompting the cancellation of this year’s Golden Globes ceremony, disrupting prime-time entertainment programs and idling of workers in a host of entertainment-related companies.

    But to those who look for trends in labor relations, the strike may provide some insights into the future of union activities in the U.S., particularly among workers outside traditional strongholds like manufacturing, service industries and government.

    "I consider this to be the first 21st century strike," says Gary Chaison, professor of industrial relations at Clark University in Worcester, Massachusetts. "It involves skilled workers who are usually freelancers, it involves communications technology, and it involves control over profits."

    The profits in question revolve around new technology that allows films, TV shows and other programs to be delivered over the Internet and on cell phones, iPods and other devices. Revenues from those sources are still relatively small but are expected to grow significantly. The writers, who view their craft as essential to the creation of content, want to ensure that the producers share the profits they may make from new distribution channels in the future.

    Most strikes typically revolve around frontline workers trying to secure basic pay and benefit concessions from management. Contracts often involve clauses that adjust pay for inflation to ensure that workers don’t lose ground. The Writers Guild of America, on the other hand, called the strike in November to demand a healthy cut of future profits that may or may not materialize as their creative work is distributed through new venues created by technology.

    "Most negotiations are defensive, with parties trying to hold on to past gains," Chaison says. "What we are seeing here is more of an offensive strike, trying to get a handle on an issue before it becomes overwhelming."

    Because the entertainment industry gets such broad national and international coverage, the strike has attracted widespread interest. That has allowed a relatively small group of workers concentrated in Los Angeles and New York to get attention around the globe. That may not necessarily win support, but it at least gives writers the opportunity to pitch their cause to a broad audience and possibly bring pressure on producers.

    "Labor is learning how to fight back in a tough global economy," says Kate Bronfenbrenner, director of labor education research at Cornell University’s School of Industrial and Labor Relations. "What it takes to win is to use the resources and use them more effectively. That is what the writers are doing."

    But the broad significance of the strike seen by some academics and labor specialists is not universally recognized. Indeed, some management consultants are convinced that the writers strike will make no difference to labor relations in the rest of the economy because it involves a very specialized group of workers in a unique industry.

    "No one is asking me, ‘What is the impact of the writers strike?’ " says Stephen J. Cabot, a corporate consultant on labor issues who runs the Cabot Institute in Palm Coast, Florida. "It is not significant."

    If there are lessons to be learned from the writers strike, the themes are more traditional and universal, Cabot says. At heart, the writers strike revolves around a standoff between management and labor over pay.

    "This is a reminder of the lengths that employees will go to support their positions when they believe that they are being treated in an inequitable fashion," Cabot says. "Many companies have the mind-set that if employees are unhappy, they won’t strike, and if they do strike it won’t last long. But employees will dig in for the long haul to get what they believe is a justified economic remuneration."

    John Hermann, president and CEO of Labor Relations Inc. in Newport Beach, California, who represents management in labor issues, including union-organizing actions, says there are about 250 strikes ongoing in the U.S. at any given moment, and the only thing that gives the writers strike a higher profile is its Hollywood connection.

    "This strike is viewed more as an anomaly, because these people are considered to be artists and there is not a real clarity in terms of: Are they contractors, are they work-for-hire people?" Hermann says. "It is also viewed in light of the fact that this is a Hollywood show."

    Chaison says the writers strike has so far failed to make much of an impression on the rest of organized labor, either.

    "What’s surprising in this strike is how little support is being given by other labor unions," Chaison says. "They see themselves as having different problems. The autoworkers, the steel workers, they are not walking the picket lines, they are not putting pressure on politicians to somehow try to end this. They are trying to protect members’ jobs in face of foreign competition. They are trying to organize workers at Wal-Mart."

    While Hollywood remains a bastion of union membership, with unions covering not just writers but actors and various crafts in the production of programs and plays, the rest of the economy has been shedding unions for decades. Union membership peaked in the 1950s, when about a third of all U.S. workers were members. Today, it is estimated that around 10 percent are covered by collective bargaining agreements—slightly more in the public sector, slightly less in the private.

    The shift is partly the result of the success unions had in persuading companies to improve pay, benefits and working conditions.

    "There has been a consistent degeneration of union membership over the last 50 years, as employers have become more responsive to the ‘justifiable’ needs of their employees, thereby eliminating the perceived need for employees to be represented by a union," Hermann says. "Our perspective is that there are still pockets of irresponsible employers who do not look after the proper care and feeding of their employees and thereby actually solicit union intervention on behalf of their employees."

    One thing that just about all observers agree on is that the writers strike will be damaging to the interests of both sides, and the negative economic impacts will increase the longer the strike continues. As Chaison sees it, both sides have legitimate concerns: The writers are worried about seeing their incomes drop if distribution shifts to new venues, while producers are concerned about making concessions over potential future profits when they have no certainty that those profits will materialize.

    But because this is Hollywood, negotiations have been tripped up by egos.

    "In many ways, the core of this is people’s over-inflated impressions of what they do," Chaison says. "They have let their egos get in the way of reaching a settlement. It is really turning into a spiteful game of who can hurt the other more. That is not the way collective bargaining is supposed to work."

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