All is not well in Middle Earth.
Actors guilds including SAG, AFTRA and several international unions have issued an alert against the big-budget adaptation of "The Hobbit," stating that their members "are advised not to accept work on this non-union production." The guilds say the producers of the MGM/New Line fantasy blockbuster, to be directed by Peter Jackson, have rebuffed organizing efforts by the New Zealand unit of an Australian actors union.
Jackson shot back in a long statement issued on Sunday, hammering Austrailia's MEAA union, threatening to move the "Hobbit" shoot to Europe and claiming his film is being used as a political football to secure gains for the guild.
"It sure feels like we are being attacked simply because we are a big fat juicy target -- not for any wrong doing," Jackson said. "It feels as if we have a large Aussie cousin kicking sand in our eyes ... or to put it another way, opportunists exploiting our film for their own political gain."
(Read Jackson's full statement is in italics at the end of this story.)
MEAA's Simon Whipp told THR in an interview that success with "The Hobbit" might pave the way for unionizing other productions in the country, but he also said that in a secret ballot held in the mid-2000's, approximately 80% of 800 Kiwi actors voted to have MEAA open a New Zealand branch. MEAA did so in 2006.
Whipp also expressed hope that Jackson would be "the key to unlocking a solution." That does not seem likely now.
"The Hobbit" is not officially greenlighted but Jackson, his WingNut Films and Weta Digital have been actively preparing the adaptation of the J.R.R. Tolkien novel. The "Lord of the Rings" director has been casting the two-film "Rings" prequel for an anticipated 2011 shoot, while New Line parent Warner Bros. and the financially troubled MGM work out an arrangement to finance and distribute the pictures.
The labor discord in Jackson's home country of New Zealand, where "Hobbit" will likely be shot, has simmered for several weeks. MEAA, the International Federation of Actors (FIA), and others have written to the producers objecting to the refusal to sign a union contract.
MEAA has not managed to unionize any productions in New Zealand, making the country a sore spot for actors unions across the English-speaking world. The unions allege that productions relocate to New Zealand specifically to avoid unions terms. (Jackson, however, is based in the country.)
But Jackson, in his statement, said targeting "The Hobbit" could have the opposite effect, chasing productions from the country and "endangering" the hundreds of millions of dollars that might flow into New Zealand from back-to-back "Hobbit" films.
"Why is this endangered? Because the 'demands' of MEAA cannot be agreed to, or even considered - by law - and therefore the only options that remain involve closing 'The Hobbit' down, or more likely shifting the production to Europe," Jackson said in the statement. "It could so easily happen. I've been told that Disney are no longer bring movies to Australia because of their frustration with the MEAA."
Jackson and the film's producers claim that actors are independent contractors, making union representation illegal under New Zealand law. MEAA disagrees, citing a High Court case involving crew members, and adds that there are alternative approaches that wouldn't run afoul of the law: either issuing a non-mandatory contract that provides better terms for actors, or creating a joint venture between the production entity and the union.
The dispute ratcheted up on Friday with the member alert from actors unions in the U.S., Canada, the U.K. and Australia.
"The (MEAA) agreement for large-budget international studio films...provides for residuals that are equivalent to those under the SAG agreement," the member alert states. "The residuals proposed by the producers of 'The Hobbit' are less in every respect." A New Line spokesperson declined to comment, and Jackson was careful to say his views are not necessarily those of the studio. Reps for MGM, SAG, FIA and the producers were not immediately available for comment.
The U.S. actors guilds are known to issue member alerts of this sort from time to time, but it is extremely rare for a major studio film to be targeted.
For SAG and AFTRA members, the advisory essentially constitutes a Do Not Work order.
For instance, a SAG member working on the production would be in violation of the guild's Global Rule 1. That rule generally requires members not to work on productions not signed to a SAG agreement. SAG and AFTRA have posted the order on their websites, and the Association of Talent Agents forwarded the order on Saturday morning to its members.
Jackson said in his statement that New Line parent Warner Bros. planned to go beyond what was required and create a separate pot of profits to pay Kiwi actors who are not SAG members.
"Whatever damage MEAA is attempting to do -- and it will do damage, since that's their principal objective in targeting 'The Hobbit' -- we will continue to treat our actors and crew with respect, as we always have," Jackson said.
Read Jackson's full statement below:
Statement regarding The Hobbit and claims by the Australian Media Entertainment and Arts Alliance (MEAA):
The Australian Labour Union, the MEAA is using our production The Hobbit in an attempt to widen it's membership, and power within the New Zealand film industry. As a New Zealand filmmaker, who has nothing to hide or be ashamed about, I'm not going to see this threatening behaviour continue without some form of sensible discussion about the "facts" and "truth" behind their various allegations.
It's incredibly easy to wave the flag on behalf of workers and target the rich studios. It's not hard to generate an emotive response, nor is it hard to sway public opinion, since nobody seems to like the facts to get in the way of a good story in these situations.
Behind the claims of exploiting actors who are cast in the "non-Union" Hobbit production, and claims that various high-profile stars will refuse to take part in the films, there are clear agendas at work. As usual with these agendas, they are based on money and power.
I am not a lawyer, nor am I an expert in unions and how they operate - but I like to think I have a degree of common sense, and that's what I'm basing my observations on. Let me run over a few facts:
-- Personally speaking, I'm not anti-Union in the slightest. I'm a very proud and loyal member of three Hollywood Unions - the Directors Guild, the Producers Guild and the Writers Guild. I support the Screen Actors Guild (SAG). All these organizations (I must confess I'm not entirely sure what the difference is between a "Guild" and a "Union") do terrific work on behalf of their members.
-- Many Actors are members of SAG, but many are not -- especially younger actors and many Australian and New Zealand performers. MEAA claims we are "non-Union", but whenever we hire an actor who belongs to SAG, we always honor their working conditions, their minimum salary agreements and their residuals.
-- The SAG residuals is a small pot of money that comes from the movie's profits. The DGA and WGA have similar schemes. An agreed upon percentage of movie profits is placed in a pot, which is shared amongst the members of the guild who worked on the film in question. Despite MEAA claims that The Hobbit is "non-Union", our studio, Warner Brothers, is honoring these residuals, and making the profit sharing available to all the various Guild members - just as it did on The Lord of the Rings, and Universal did on King Kong.
-- These residuals can be worth tens of thousands of dollars to an individual if the film is successful - however the normal situation is that if an actor is not a member of SAG, they do not share in the profit pot.
-- This has always struck us as unfair, since most Kiwi actors are not lucky enough to be SAG members. For the Hobbit, Warner Brothers have agreed to create a separate pot of profit participation, which will be divided up amongst non-SAG actors who are cast in the film. This was not done because of any pressure from Guilds or Unions - it was actually Warners doing the decent thing, and New Zealand and Australian actors will be the principle beneficiaries. SAG members have their pot, and non-SAG members now have theirs. We have introduced the scheme to Kiwi agents and it's now part of all our Hobbit cast deals.
-- Whatever damage MEAA is attempting to do -- and it will do damage, since that's their principal objective in targeting The Hobbit - we will continue to treat our actors and crew with respect, as we always have.
-- As I said earlier, money and power lies behind this threatening behaviour from our Australian cousins, and to fully understand that, you simply have to step back and look at the greater picture in context.
-- It starts with "NZ Actors Equity". This is a tiny organization that represents a small minority of New Zealand Actors. They are not a Union, and have none of the legal status of a Union. They are a ... well, a smallish group who have some New Zealand actors as members. How many actors are members of NZ Equity? They guard that information very closely, but various reports I've seen put their membership at 200, although somebody in the know swears it's nearer 100.
-- How many professional actors are there in New Zealand? Somewhere between 2000 and 4000, depending on just how you describe a "professional actor". Obviously most Kiwi actors have other employment too, but there's certainly over 2000 actors available to cast in a film production.
-- So taking the most generous numbers, NZ Actors Equity represents 200 out of 2000 Kiwi actors, or 10%. Perhaps I'm wrong, and if so, NZ Equity will no doubt reveal their real membership numbers.
- Now there's nothing wrong with NZ Actors Equity representing 10% of the actors in this country. It's great that they offer that service, and if an actor chooses, there's a supportive group they can join. Obviously the more actors that join NZ Equity, the better, since these organizations usually survive by taking a small percentage of their members acting fees. I'm guessing that Equity do something like that. Recently they have been part-funded by MEAA.
- Over the last 10 years our relationship with NZ Equity has been rocky -- whenever we cast an "overseas actor", we get a letter telling us why such and such Kiwi actor would be so much better in the role. In most cases we have already auditioned the actor in question, and formed our own opinions -- but what strikes me as unfair, is how this "helpful" service of suggesting better choices only includes the "Equity 200". If you happen to be a good actor who doesn't belong to NZ Equity (and many don't), you're automatically not good enough to be put forward.
-- What really does strike me as wrong, and this is my personal opinion, is the why that the MEAA is using NZ Actors Equity as a vehicle to represent the voices and opinions of New Zealand actors. A couple of years ago, the members of NZ Actors Equity voted to join some kind of alliance with the Australian MEAA group. At the time, there were voices of alarm at how this relationship could damage the interest of Kiwi Actors, but the merger went ahead - and now we're about to find out just how damaging it's going to be.
-- As far as I know, the membership of NZ Actors Equity was allowed into the MEAA, meaning that the Australian MEAA organization represents 200 out of 2000 Kiwi actors. I don't believe it represents non-Equity NZ actors. It speaks on behalf of a tiny minority of our actors.
-- The management of NZ Equity are clearly happy to be used as a political football by the Australians -- but my sympathy goes to the 1800 New Zealand Actors who are not part of the "Equity 200", but who are going to suffer the fallout if this Hobbit thing goes nuclear.
-- I also feel a growing anger at the way this tiny minority is endangering a project that hundreds of people have worked on over the last two years, and the thousands about to be employed for the next 4 years. The hundreds of millions of Warner Brothers dollars that is about to be spent in our economy.
-- Why is this endangered? Because the "demands" of MEAA cannot be agreed to, or even considered - by law - and therefore the only options that remain involve closing the Hobbit down, or more likely shifting the production to Europe. It could so easily happen. I've been told that Disney are no longer bring movies to Australia because of their frustration with the MEAA.
-- The MEAA is demanding that the Hobbit production company (Warners owned, 3foot7 Ltd) enter into negotiations for a Union negotiated agreement covering all performers on the film.
-- I personally have a problem with any organization who represent a small minority, but attempt to take control of everyone - but that's not the real issue. The complex web of NZ labour laws are the reason why this demand will never be agreed to.
-- NZ law prohibits engaging in collective bargaining with any labour organization representing performers who are independent contractors, as film actors clearly are. The NZ Commerce Act claims it would be unlawful to engage with an Australian Union on these matters.
My personal opinion is that this is a grab for power. It does not represent a problem that needs a solution. There will always be differing opinions when it comes down to work and conditions, but I have always attempted to treat my actors and crew with fairness and respect. We have created a very favorable profit sharing pool for the non-Union actors on The Hobbit -- and now the Union is targeting us, despite the fact that we have always respected SAG conditions and residuals.
I can't see beyond the ugly spectre of an Australian bully-boy, using what he perceives as his weak Kiwi cousins to gain a foothold in this country's film industry. They want greater membership, since they get to increase their bank balance.
The conspiracy theories are numerous, so take your pick: We have done better in recent years, with attracting overseas movies -- and the Australians would like a greater slice of the pie, which begins with them using The Hobbit to gain control of our film industry. There is a twisted logic to seeing NZ humiliated on the world stage, by losing the Hobbit to Eastern Europe. Warners would take a financial hit that would cause other studios to steer clear of New Zealand.
-- Seriously, if the Hobbit goes east (Eastern Europe in fact) -- look forward to a long dry big budget movie drought in this country.
-- Others gain from that too. SAG would much rather have it's members hired on movies -- as opposed to non-SAG actors. The easiest way to control that, is to stem what are called "runaway productions", which are American funded films made outside of America. The Hobbit is one of them, as was King Kong and LOTR. SAG, which is naturally supporting MEAA, would see it's own benefit in studios having a miserable experience in Australia/New Zealand. That may well be pushing the conspiracy theories one step too far, and it's perfectly natural that one Union would support another - but the point is that in the complex web of Hollywood intrigue, you never really know who's doing what to whom and why.
But it sure feels like we are being attacked simply because we are a big fat juicy target - not for any wrong doing. We haven't even been greenlit yet! It feels as if we have a large Aussie cousin kicking sand in our eyes ... or to put it another way, opportunists exploiting our film for their own political gain.
(NB: This represents Peter Jackson's opinion as a Kiwi filmmaker, and not that of Warner Bros or New Line Cinema, who were not consulted about this statement.)