Court Arbitration Decision a Major Victory for the CFTPA - and the entire Industry

Anyone working in the Canadian Production Industry should be aware that the Ontario Superior Court ruled yesterday in favour of the CFTPA’s request to assign an arbitrator. The court decision is clearly a victory for the CFTPA and the entire industry because it is the first step towards ending ACTRA’s illegal strike.

In a press release issued by ACTRA, the decision was portrayed as a failure to end the unlawful strike and put an end to the continuation letters. The CFTPA’s primary objective was to have the court uphold our contention that ACTRA must abide by the IPA and the rules that are set out in it regarding the steps that must be taken in order to call a strike. The court recognized this and ruled in favour of the CFTPA. ACTRA’s release was designed to deflect attention away from the CFTPA’s success regarding arbitration in an attempt to justify their illegal actions.

The CFTPA maintains the position that the issue of the illegality of the strike and continuation letters is a matter that falls directly under the IPA, and therefore, will be dealt with in the arbitration process. The court’s decision brings ACTRA’s continued attempts to avoid answering these questions to an abrupt halt.

ACTRA’s claim that it has somehow gained ground in this dispute as a result of this decision is a distortion of the facts and an insult to an industry that is reeling from the effects of its illegal strike. The fact that the court has ruled that ACTRA pay costs to the CFTPA – a common court practice when awarding a victory – should tell members and the community at large that ACTRA is at fault.

The court’s decision was incredibly important for Producers, because it upholds the CFTPA’s long held position that the IPA and the Negotiation Protocol are the only avenues for dispute resolution. The certainty that this decision brings to labour relations in the film and television industry is key for our future success.

The CFTPA would encourage the wide circulate this information to anyone – and ACTRA members in particular - who may benefit from having accurate information regarding the court proceedings, the illegality of the strike and the process of arbitration.

Below is a Q & A that we hope will help answer some of your questions as well as address the direction the CFTPA is taking as a result of this decision.

WHAT WAS THE COURT CASE ABOUT?

The CFTPA asked the Court to compel ACTRA to live up to the IPA. In this case, that means having the question as to whether this is a legal strike or not be determined by an arbitrator. The CFTPA did not ask the Court to determine the legality of the strike or the continuation letters.

The Court rule in favour of the CFTPA and has told ACTRA that if it can’t agree to an arbitrator with the CFTPA, then the Court will appoint one.

WHAT IS THE ARBITRATOR’S ROLE IN ALL THIS?

The arbitrator will be tasked with making a decision regarding the legality of ACTRA’s strike under the IPA. Regardless of any action that ACTRA has taken on a provincial level, ACTRA did not follow the steps necessary under the IPA to be in a legal strike position. The CFTPA maintains the position that the strike action made by ACTRA violates the Negotiating Protocol and therefore is entirely illegal. It may take the arbitrator a few weeks to consider the answer to this question, and so the CFTPA will ask the arbitrator for an interim order that ACTRA cease striking until a decision is rendered.

Unlike some arbitrators, the arbitrator in this case will not be asked to act as a mediator or a conciliator in helping the parties to arrive at a settlement. So, in other words, the arbitrator will not be considering the bargaining issues but will instead have a very specific question put in front of him or her regarding ACTRA’s conduct in initiating an illegal strike and promulgating continuation letters.

WHAT HAPPENS NEXT?

Hopefully, the CFTPA and ACTRA will get an agreement. The CFTPA and its partner, the APFTQ, are willing to sit down with ACTRA at any time. However, if ACTRA continues to hold to the same positions that it has been taking for the last month then very little progress will be made.

If a settlement is not possible, we will be proceeding to have the illegal strike stopped and to have the continuation letters set aside. The CFTPA will be seeking damages against ACTRA for its actions in carrying out this unlawful strike and so encourages all producers who have experienced a monetary impact from ACTRA’s illegal actions to contact the CFTPA with the details of the project and the amounts that have been lost due to ACTRA’s conduct.

DOES THIS MEAN THE STRIKE WILL BE OVER FOR GOOD?

No. If ACTRA wanted to conduct a real strike it would be required to go through the proper steps under the IPA to place itself in a legal strike position. That process would take the better part of a month to achieve. So when the strike is declared unlawful ACTRA could continue to destabilize the industry if it chose to do so.

THEN WOULDN’T WE BE BACK IN THE SAME MESS?

No. A real strike by ACTRA would be different because one of the key requirements of the IPA is that ACTRA has to strike against all producers or no producers. It can’t selectively choose who it is going to strike against. In short, ACTRA has to be willing to shut down the entire Canadian industry outside of BC. It may choose to do so, and that would be a very reckless choice. In the meantime, we would do everything we can to find a reasonable deal with ACTRA to keep that from occurring.

One of the key requirements of the Agreement is the mandatory conciliation process. The use of a conciliator through this process may bring both sides to a greater understanding of the other’s position and might make a deal a realistic possibility.

SO WHY IS THE CFTPA REFUSING TO SEND THE NEW MEDIA ISSUES TO A JOINT COMMITTEE AS ACTRA HAS SUGGESTED?

The answer is straight forward. We’re not refusing to send all new media issues to a joint
committee, just the least complicated and most fundamental one – the issue of whether or not producers have the right to distribute productions produced for conventional media, such as television shows, on digital platforms such as the internet.

Producers everywhere else in the English-language world including BC have the rights to distribute their conventional content on the internet and on other new media platforms. Those rights don’t exist under the IPA, which means that the IPA is out of step with regard to new media rights. ACTRA’s position is like telling someone starting up a new business that they can’t promote and develop their business by using the internet. In the real world, that’s just not reasonable.

All producers, from large companies to small companies, have new media as part of their strategy for exploiting productions. At present, these new media platforms are largely promotional in nature. Internet streaming, mobile phone promos etc. are largely used to drive audiences to and keep them with conventional television programs. This is why broadcasters and other distributors pay producers very little - if anything - for these new media rights. No doubt that will change in the future. For now, Producers get little or no additional money for distribution of their product on new media platforms.

What ACTRA is asking for is a 50% raise as a guaranteed payment for new media rights at a time when Producers aren’t getting any more money for these rights.

Producers are prepared to share revenue related to new media platforms with performers. In other words, when Producers make money, performers make money. This is much the same arrangement we have with the DGC and the WGC. But asking Producers to pay in advance for something that, at present, has little or no value only drives up costs and makes getting productions made that much more difficult. We know this will change in a few years. We also know that performers have voiced their concern that they made a mistake when compact device terms were negotiated and that they don’t want to repeat a past mistake. That’s why we have offered ACTRA what is known as a “sunset clause”.

We know that performers are concerned that they made a big mistake when compact device terms were added to the agreement and so, in recognition of this concern whatever we agree to in the area of new media this time will be torn up and thrown away next time we sit down in bargaining. In other words, we will be starting from a fresh position with neither party being prejudiced to what we have agreed to in this round of bargaining.

BUT WHY CAN’T YOU WORK THIS OUT ON A PRODUCTION-BY-PRODUCTION OR CASE-BY-CASE BASIS?

We’ve tried that and it didn’t work. The IPA currently requires ACTRA and the CFTPA to work together to negotiate these new media deals. In certain circumstances ACTRA worked with the CFTPA negotiating Producer/Performer arrangements. In those cases, the kind of revenue share arrangements we talked about above were agreed upon. Unfortunately, ACTRA, once again, did an end run around the Agreement and attempted to negotiate deals without CFTPA’s involvement. When it did this, it took advantage of the producer’s inexperience in dealing with these new media deals and broke its agreement with the CFTPA. The result was that ACTRA was able to extort payments for New Media Rights that had no relationship to the amount of money that Producers were receiving from broadcasters and other distributors. ACTRA is now trying to rely on these unlawful deals as a precedent to justify its demands in this round of bargaining.

In short, case-by-case hasn’t worked in the past because:

• ACTRA hasn’t been willing to live up to its own deal on several occasions;
• Producers need predictability in order to budget their productions; and
• Producers need New Media Rights in order to sell their productions to broadcasters and other distributors who insist upon having a new media strategy as an integral part of any exploitation plan.

SO WHAT ABOUT THE REST OF THE NEW MEDIA ISSUES SUCH AS ORIGINAL CONTENT MADE FOR NEW MEDIA PLATFORMS SUCH AS CELLPHONES?

We think it shouldn’t be too hard to work out a deal with ACTRA that would allow for these productions to get made and performers to get compensated fairly. If we don’t work something out, this work will inevitably go non-union or move offshore. Large US studios want to bring this kind of work to Canada but they won’t do so if they don’t know what the playing field looks like in advance. Indigenous producers will simply work non-union in this new space much like they have in the area of fact-based/lifestyle and reality programming. This benefits no-one, especially ACTRA performers who are prevented by ACTRA from working non-union. Here too, Producers are prepared to pay performers when we make product, pay performers when we use product and pay performers a third time when that product is converted to conventional use such as television or DVD.

BUT WOULDN’T A COMMITTEE ON NEW MEDIA BE USEFUL?

Absolutely. The CFTPA has suggested to ACTRA that we jointly share the costs on a new media expert to teach us both what we don’t know. This will put us in a better position to bargain these issues in a few years time. If we have a shared information base, our likelihood of coming into conflict in the future will be reduced. Neither the CFTPA nor ACTRA want to find themselves in this kind of mess three years from now, and we have a shared responsibility to the industry to ensure this never happens again.

WHAT ABOUT ACTRA’S WAGE PROPOSAL?

ACTRA is currently proposing a 10% increase over 3 years in wages and benefits. This stands in sharp contrast to a 2% increase over 3 years with NABET, a 3% increase over 3 years with the DGC and a 4% increase over 3 years with the WGC.

What we offered ACTRA was a 3% increase in each year of a 3 year deal or a 9% increase for the majority of productions and 6% over 3 years on 10 out of 10 Canadian content productions. This offer was conditional upon ACTRA reaching a deal on the making of original new media content as well as the repurposing of conventional content on new media platforms.

In other words, we tried to express to ACTRA that we would be prepared to pay a larger increase to performers than we had to any other union in exchange for their willingness to work to find a solution in the area of new media.

ACTRA’s suggestion that we pay a 10% increase over 3 years without solving any new media issues simply cannot be justified in an environment where license fees paid by broadcasters have been flat for 10 years and production costs have gone up over 28% in that same time period.

In short, our willingness to step out of the patterns established with the WGC, the DGC and NABET was and remains tied to ACTRA’s willingness to find creative solutions to the Producer’s need for New Media Rights.

IN SHORT…

• ACTRA and the CFTPA have agreed to everything except for the final wage package and treatment of the internet.
• All of the issues that caused so much grief at the front end of this bargaining process have been resolved and the parties tentatively agreed on a number of changes to the Agreement that will create work opportunities for ACTRA members and at the same time benefit lower budget production.
• Producers are proposing a pay increase for performers that exceeds what other Canadian guilds and unions have agreed to and will agree to further increases if the new media issues are resolved.
• Producers have agreed to “park” all of the new media issues except for the most basic issue of the right to distribute conventional programming on a digital platform because it’s fundamental to how we do business. Producers have agreed that it makes absolute sense for a joint committee with a sharedcost expert to be created.

Given the above, the state of the industry and the fact that only 39% of ACTRA members even voted in the nationally conducted “strike vote”, it only seems reasonable that ACTRA would want to resume bargaining. We certainly do. However, if ACTRA continues to hold to the same positions that it has been taking for the last month then very little progress will be made.