26 February, 2013

Statement to accompany the release of Official Information Act documents

WingNut Films welcomes the release of documents pertaining to the industrial action that was initiated by the Australian based trade union, the MEAA, against the film production of The Hobbit in 2010.

Whilst we would not personally seek to re-litigate this issue, it is our hope that these documents will lead to a better understanding of the events as they unfolded.

We also hope the release of these documents will put to rest the unfounded conspiracy theories that sought to characterize these events as a Hollywood studio dictating terms to a sovereign government - a charge that is as spurious now as it was then.

These papers reflect the intense stress we, as filmmakers, were under finding the future of our films suddenly under threat by unjustified industrial action - a crisis that quickly lead to the very real possibility that Warner Bros would have no choice but to pull The Hobbit out of New Zealand.

Historically terms and conditions of employment in the NZ film industry have been set by discussion between unions, guilds and producers groups around a conference table. In this case, the MEAA deliberately singled out The Hobbit production in advance, demanding that we enter into an illegal collective bargaining arrangement.

We have no issue with collective bargaining, nor did we set the precedent of the vast majority of New Zealand actors being employed as independent contractors. This status has come about, in part, from New Zealand actors own desire to take advantage of various tax exemptions - including being able to off-set the 10% agents fee many of them have to pay. This status, which was not forced upon actors, does however mean they are subject to the New Zealand employment law which states that they cannot enter into a collective bargaining agreement. Put simply, we were being asked to agree to an illegal demand – patently putting us in an impossible position.

The Memo of Sept 28th, entitled "Background Information" has a detailed account of the many issues involved.

The Basic Situation

Most films are managed by short term companies set up to deal with a particular film. In the case of The Hobbit, the company is 3 Foot 7 Ltd. Most film industry workers, whether actors, or crew are engaged for short periods of time as Independent Contractors. It's simply not practical for these short term film production companies to take on the burden of treating its actors and crew as "Employees", most of who work for only weeks or months. Nobody disagrees with this, within the film industry or government, and frankly it would be impossible for the New Zealand film industry to function under any other terms.

And yet the Australian based MEAA had quietly arranged a world-wide blacklist of The Hobbit. This was done well in advance of its first communication with 3Foot7 Ltd in August 2010. The lifting of this “blacklist” required 3Foot7 Ltd to agree to enter into a Collective Bargaining agreement, to be negotiated by the MEAA. Why were they so confident of success?

The "Bryson Case"

A Lord of the Rings crew member, who was hired as an independent contractor, took 3Foot6 Ltd (the Lord of the Rings production company) to court, to argue that he was an "Employee". After a long legal fight, he won that case however the judge who ruled in Bryson's favour, Justice Shaw, acknowledged in her ruling that this decision would create uncertainty within the film industry and suggested that it was something SPADA (the Producers Guild) needed to address. It would require greater clarity in the employment laws relating to contractors and employees. The MEAA made their demands upon The Hobbit before the ramifications of the Bryson ruling could be properly addressed between the industry and government.

It was clear to us that the studio was not going to be able to make The Hobbit in New Zealand. We were facing a situation where a trade union - who had already shown themselves ready to act unilaterally without any consultation within the broader industry and without engaging in genuine negotiations before instituting a world-wide blacklist - could potentially exploit the Bryson ruling. This would then throw into doubt the employment status of the many thousands of people 3Foot7 Ltd were about to begin hiring. It was an impossible situation for both the producers of the film and the studio.

The "Law Change"

There has been a lot of rhetoric from the MEAA and its supporters, about Warner Bros forcing the NZ government to "change the law".

Warner Brothers found themselves in a situation they did not create or foresee. They had already spent millions down here in New Zealand. They were facing huge financial risks in continuing to operate in such an uncertain employment environment.

The studio needed certainty that people hired as independent contractors would not be retrospectively deemed to be employees, as had happened with the Bryson Decision.

The New Zealand Government acted to protect its film industry by clarifying the legal status of all independent contractors working in film. What this so called “change to the law” actually meant in practice was the status of actors and crew hired within the film industry remained exactly the same as the already established practice.

In Conclusion

As a result of the MEAA’s industrial action, we found ourselves in the surreal situation of being asked by hundreds of actors and crew within the New Zealand film industry, to defend them from the destructive actions of trade union officials, the very people who were supposed to be on their side.

The situation we found ourselves in would have been ludicrous to the point of being absurd but for the fact that thousands of NZ jobs were on the line and hundreds of millions of dollars of income for our country was going to be lost.

The e-mails contained in this release represent a very upsetting time in our professional careers. We could have made the Hobbit in Europe, or New South Wales (who offered Warner Brothers a huge tax rebate for the film), and earned the same fee for ourselves with a lot less stress. But we fought to keep the film here and work with the actors and crew we love.

We think this was worth fighting for and we’d do it again.

Peter Jackson and Fran Walsh

ENDS

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