Finding Harmony with Labor
In tough economic times, the entertainment industry, like many employers, must negotiate with labor unions to find cost savings. During these negotiations, each side has “economic weapons” at its disposal that can be used to apply pressure and gain leverage in the bargaining process. For unions and their members, that leverage often takes the form of a strike or work stoppage.
Strikes are often threatened and are costly when they occur. Someone striking over economic terms, such as wages and benefits, is known as an economic striker, and in Missouri, that striking employee is not entitled to unemployment benefits. Economic strikers can also be permanently replaced by their employer.
Being permanently replaced does not mean terminated. Permanently replaced employees are not entitled to their job at the end of the strike and, instead, must wait for their replacement to leave. The National Labor Relations Act provides all private sector employees, whether represented by a union or not, the right to strike. Although employees can apply pressure by striking, they also face the real possibility of going without pay and benefits during the strike and potentially being permanently replaced.
Employers can also apply pressure in bargaining by exercising their right to “lock out” the employees. Employers have decided to lock out employees based on fear of workplace sabotage or to apply pressure when seeking concessions from the union and employees.
Some prime examples come from the classical music sector, in which orchestra and opera companies frequently deal with shrinking budgets and are forced to collectively bargain in good faith with unions for concessions. In our own state, the St. Louis Symphony experienced a lengthy and difficult work stoppage in 2005 and, just last year, successfully negotiated a new five-year contract with the musicians to secure labor peace and cost controls. The Minnesota Orchestra in Minneapolis locked out its musicians in October of 2012. The lockout lasted 15 months until the union ratified a new contract including pay reductions and increases in health insurance premiums. Currently, the Metropolitan Opera in New York is negotiating with union members, and there are reports that both sides are digging in for difficult bargaining.
Orchestra and opera management companies are not the only entertainment industry employers to face tough negotiations. The Hollywood Writers strike unintentionally led to an increase in reality television. Baseball, basketball, football, and hockey sports leagues have all experienced strikes and lockouts; players and owners negotiated over pay, benefits, and other terms and conditions of employment. Regardless of the industry, an employer must understand the legal framework governing collective bargaining. Negotiations can result in concessions, but it can be a long, difficult process to achieve those givebacks. Privately held businesses often don’t want to open their financial books to their employees or a union, but in concessionary bargaining, they might be required to do so if they claim an inability to pay at the table. Skilled labor negotiators with a firm grasp of National Labor Relations Board case law are essential to successfully negotiating a concessionary labor contract without violating the National Labor Relations Act.